Davidson Interiors declared a dividend to holders of record on Thursday, October

Question

Davidson Interiors declared a dividend to holders of record on Thursday, October 15, that is payable on Monday, November 2. Suenette purchased 200 shares of Davidson Interiors stock on Monday, October 12, and Jake purchased 100 shares of this stock on the following day. Which one of the following statements is correct given this information?

Neither Suenette nor Jake will receive this dividend.

Suenette will receive the dividend but

Jake will not. Jake will receive the dividend but Suenette will not.

You cannot determine who will or will not receive this dividend based on the information provided.

Both Suenette and Jake will receive this dividend.

Explanation / Answer

To receive the dividend,shares should be purchased befoe the recoding date.

The settlement date for stock trade is three business days after the date of Purchase.

Suenette purchased stock on Monday,October 12.

Settlement date will be October 15(Thrusday),which the record date.

so Suenette is eligible for Dividend on 200 shares purchased.

Jake purchased shares on October,13(Tuesday)

Settlement date will be October 15(Friday),which is after the record date.

so Jake is not eligible to receive dividend on stocks purchased.

Correct statement is Suenette will receive the dividend and Jake will not receive the dividend.

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