Ünite 7: Shareholders’ Equity: Retained Earnings and Dividends — Veri Tablosu

Comparison of Dividend Types and Share Splits

Type	Cash Impact	Total Equity Impact	Journal Entry Required	Accounting Basis
Cash Dividends	Decreases cash	Decreases total equity	Yes, on declaration and payment dates	Paid out of retained earnings
Small Share Dividends	No cash impact	No change in total equity	Yes, transfers equity to contributed capital	Recorded at fair market value (under 20-25%)
Large Share Dividends	No cash impact	No change in total equity	Yes, transfers equity to contributed capital	Recorded at par or stated value (over 20-25%)
Share Splits	No cash impact	No change in total equity	No, documented via memorandum entry	Reduces par value and increases share count