Question

difference between dividend and interest.
class 12th accountancy. plzz urgent.

Answer 1

Dividends are not an expense of the corporation and, therefore, dividends do not reduce the corporation's net income or its taxable income. When a dividend of $100,000 is declared and paid, the corporation's cash is reduced by $100,000 and its retained earnings (part of stockholders' equity) is reduced by $100,000.

Credit Unions are structured such that the account holders are in fact the owners of the institution. Thus, the money invested in your savings account is in fact a share of ownership, and the interest paid to you is dividend. Tax-wise, thesedividends are usually treated asinterest income.

it may help u..