Which of the Following Is Not True Regarding Restrictions on Dividend

question 58

Multiple Choice

Which of the following is not true regarding restrictions on dividend payments?

• A)These restrictions typically arise when loan agreements prohibit the registrant from paying cash dividends without the consent of the lender.
• B)In certain cases,restrictions at a subsidiary-company level exist such that the registrant's subsidiary companies may not transfer amounts to the registrant without the consent of a third party.
• C)Amounts subject to restrictions must be disclosed.
• D)The auditor will typically confirm with shareholders whether there are any side agreements regarding dividend restrictions.

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Definitions:

Toronto Law Firm

A legal practice based in Toronto, Canada, offering various legal services and representation to its clients.

Economy Sector

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Involuntary Part-time Workers

Individuals who are working fewer hours than they desire or need, due to circumstances such as an inability to find full-time employment or cuts in work hours by their employer.

Previously Retired

Refers to individuals who had exited the workforce upon reaching the age or conditions for retirement but may have returned to work or active professional life.