Dividend

A portion of the principal or profits divided among several owners of a thing. The term is usually applied to the division of the profits arising out of bank or other stodts, or to the division among the creditors of the effects of an insolvent estate. In another sense, according to some old authorities, it signifies one part of an indenture. A corporate profit set aside, declared and ordered by the directors to be paid to the stockholders on demand or at a fixed time.

20S 111. 818.

A cash dividend is a disbursement to the stockholder of accumulated earnings, and dend involves no disbursement by the corporation. It parts with nothing, and the stockholder receives merely certificates of stock which evidence, with his former shares, his interest in the entire capital. Stock dividends represent an addition from accrued earnings to the capital of the company; but they do not represent income, but merely additions to the source of income.

Hale, Private Corporations, 227.