On the Payment Date for a Dividend,the Company

question 109

Multiple Choice

On the payment date for a dividend,the company:

• A)debits Dividends Declared and credits Dividends Payable for the amount of the dividend.
• B)debits Dividend Expense and credits Cash for the dividend amount.
• C)debits Dividends Payable and credits Cash for the dividend amount.
• D)establishes who will receive the dividend payment.

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Definitions:

Net Advantage

The total benefit gained from a particular action or decision, minus the costs incurred.

Corporate Tax Rate

The percentage of a corporation's income that is paid to the government as tax.

CCA Class

In the context of Canadian taxation, a method to categorize depreciable property according to its class for the purpose of determining capital cost allowance rates.

Incremental Cash Flow

The additional cash flow a company receives from taking on a new project, considering both the inflows and outflows caused by the project.