How to record Dividend with QNE Optimum

What is a dividend?

Dividend (definition)

A dividend is a share of a company's profits that is distributed to its shareholders. It serves as a method for a company to allocate earnings to its owners. 

The term "dividend" originates from the idea of dividing profits, specifically among shareholders. 

However, companies are not obligated to pay dividends. Instead, they must assess their financial stability before making such distributions. The authority to declare dividends lies with the company's board of directors.

Types of dividends

A dividend can be distributed through various methods, including cash payments, issuance of additional shares, or even property. 

Cash dividends are the most common form. 

The company determines the amount to be paid per share, which shareholders receive for each share they hold.

How to record Dividend paid?

Solution :

Step 1 - User require to create 2 Account in Chart of Account

• in Appropriation Account - Create Dividend
• in Current Liabilities - Create Dividend Payable

Step 2 - When users wants to declare Dividend, Create a Journal Entries.

Debit Dividend

     Credit Dividend Payable

Profit and Loss Presentation

Balance Sheet Presentation

Step 3 - When user wants to paid to shareholders, create a Payment Voucher.

Debit Dividend Payable

    Credit Bank

Balance Sheet Presentation 

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