Dividend Declaration
Definition
The formal decision by a company's board or shareholders to distribute part of its profits to shareholders. Once declared, a dividend becomes a liability until it is paid.
Related Terms in Business Terms
Bill of Exchange
A written, signed order by one party directing another to pay a fixed sum to a third on demand or at a set future date. It is a negotiable instrument used to formalise and transfer trade credit.
Promissory Note
A written promise by one party to pay a definite sum to another on demand or at a specified date. Unlike a bill of exchange it is made by the payer rather than ordering a third party to pay.
MRR (Monthly Recurring Revenue)
The predictable revenue a subscription business earns each month. Calculated by multiplying the number of paying customers by the average revenue per user (ARPU). Key SaaS metric.
ARR (Annual Recurring Revenue)
The annualized version of MRR (MRR x 12). Used by SaaS companies to measure predictable yearly revenue. A key metric for valuation and growth tracking.
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