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True, a company received dividends of $0.35 per share on 300 shares of stock it holds as an investment. The journal entry to record this transaction would be to debit Cash for $105 and credit Dividend Revenue for $105.
A dividend is a payment made by a company to its shareholders that is decided by the board of directors. Dividend payments are frequently made quarterly and can take the form of cash payments or stock reinvestments. Dividends give investors another way to profit, particularly if current income is the main objective. For financial objectives, many investors discover that purchasing and holding businesses with a solid track record of paying dividends makes sense. A great investment plan may include dividend investing. Historically, less volatile dividend stocks have outperformed the S&P 500. Taxes must be paid even if you reinvest all of your dividends in the same company or fund that gave them to you in the first place.
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