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    rainkingkc's Avatar
    rainkingkc Posts: 1, Reputation: 1
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    #1

    Oct 2, 2005, 03:42 PM
    Property Dividend Explanation Needed!
    I'm currently studying for my Series 7. I just started. I'm using ARCO's reference exam guide, which, by the way, I heard is unreliable at best, so... :rolleyes:

    I understand cash and stock dividends. But their description of property dividends is very brief only a few sentences long.

    A few examples would be a good reference too. I don't need a novel or anything, just something so I can grasp an understanding of the topic.

    Thanks.
    sph's Avatar
    sph Posts: 1, Reputation: 1
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    #2

    Feb 25, 2008, 10:10 PM
    A property dividend is when a company distributes property to shareholders instead of cash or stock. This type of allocation is a physical transfer of a tangible asset from the company to the investors. Property dividends can literally take the form of railroad cars, pencils,salad dressing or any other item with tangible value. Property dividends are recorded at market value on the declaration date.
    If the company wanted to pay out dividends but didn't have enough Treasury stock or enough money to pay out all investors, the company could look for something physical (property) to distribute.

    Hope that helps ::eek:
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