Question

KL Electronics has paid a quarterly dividend of $.42 per share for the past two years.This quarter,the firm plans to pay $.42 plus an additional $.05 per share.The firm has stated that it is uncertain whether it will pay $.42 or $.47 per share next quarter.Which one of the following is the best description of the additional $.05 that is being paid this quarter?

A) Liquidating dividend
B) Special dividend
C) Extra dividend
D) Stock dividend
E) Normal dividend

Answer 1

The answer is C. Extra Dividend

Step-by-step explanation:

As being stated above(in the answer section), the answer is extra dividend.

Extra Dividend is the form of dividend paid to shareholders in addition to the normal regular dividend. This usually happens during the period of unexpected high profit.

Also, this is paid after the year-end.

If this dividend was paid in form of additional stock being given to the shareholders, then it will be called stock dividend.