The Payment of a Previously Declared Cash Dividend Has an Overall

question 52

Multiple Choice

The payment of a previously declared cash dividend has an overall effect of:

• A) Reducing retained earnings and reducing liabilities by the amount of the dividend.
• B) Reducing retained earnings and increasing contributed capital by the same amount.
• C)Reducing assets and reducing liabilities by the amount of the dividend.
• D)Reducing both assets and retained earnings by the amount of the dividenD.The payment of a previously declared dividend decreases the asset, cash, and decreases the liability, dividends payable.

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