Question

The owners of abc, inc. may expect to be paid a share of the profits of the company. these payments to owners are called:

Answer 1

The answer is dividends.

Dividends refer to a payment that is made by a company to its shareholders based on the profits that the company make.

How much the shareholders get are usually already arranged in the agreement that each shareholders receive when choosing to purchase or own a company’s shares.

Companies that are listed in the stock exchanges usually have a fixed payment schedule for its dividends.