Instead of paying a cash dividend this year, more Goanna Ltd shares were issued to the existing shareholders of Goanna Ltd out of Goanna Ltd's profit.This action is called:

Question

Quizplus · Accepted Answer

Capitalisation of profits refers to the conversion of profits or earnings into additional shares rather than paying them out as cash dividends. This results in an increase in the number of outstanding shares and a decrease in the earnings per share (EPS), but it can also lead to an increase in the shareholder's equity.

Instead of Paying a Cash Dividend This Year, More Goanna