If Dividends Are Declared and Paid in the Same Accounting

question 26

Multiple Choice

If dividends are declared and paid in the same accounting period, what is the net effect on the accounting equation?

• A)A decrease in retained earnings and an increase in expenses.
• B)A decrease in cash and an increase expenses.
• C)A decrease in cash and an increase in retained earnings.
• D)A decrease in cash and a decrease in retained earnings.

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Definitions:

Confidence Level

The probability that the value of a parameter falls within a specified range of values, often associated with a confidence interval.

Confidence Interval

A range of values derived from sample data that is likely to contain the true population parameter with a specified level of confidence.

Population Mean

The average value of all elements in a population.

Population Values

The actual numerical values representing a characteristic of every individual member of a population.