What is the term for the date that determines who is eligible to receive the upcoming dividend?

The correct term for the date that determines who is eligible to receive the upcoming dividend is known as the Record Date. This date is critical because it establishes the cutoff point for determining which shareholders are entitled to receive dividends. Shareholders who are on the company's books as of this date will receive the declared dividend, while those who purchase shares after this date will not be eligible, even if they own the shares before the dividend payment is made.

The importance of the Record Date lies in its role in the dividend distribution process, as it directly affects shareholder eligibility. This typically follows a series of transactions where shares are bought and sold; thus, the Record Date ensures clarity about who the rightful owners of the shares are at the time the dividend is issued.

In contrast, the Ex-Date refers to the first day shares trade without the dividend, and typically occurs one business day before the Record Date. The Payable Date is when the dividend is actually paid out to the shareholders on record, while the Settlement Date is when a transaction is finalized, including the transfer of ownership of the shares, but it is not specifically linked to dividend eligibility.