Which of the Following Is Not a Substantive Test of Details

question 47

Multiple Choice

Which of the following is not a substantive test of details for dividends?

• A)Calculation of the dividend payout ratio.
• B)Examination of the minutes of the board of directors' meetings for authorization of the dividend per share amount.
• C)Examination of the minutes of the board of directors' meetings for the dividend record date.
• D)Agreement of the dividend amount with the payment in the cash disbursements journal.

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Definitions:

Fixed Cost

Expenses that do not change with changes in the volume of production, such as rent, salaries, and insurance.

Depreciation of Capital

This refers to the decrease in the value of physical assets over time due to use, wear and tear, or obsolescence.

Wages Paid

The amount of money workers receive from employers in exchange for their labor.

Sunk Costs

Sunk costs are past expenditures that have already been incurred and cannot be recovered, and thus should not impact future decision-making.