When Should Cash Dividends Be Recorded

question 7

Multiple Choice

When should cash dividends be recorded?

• A)On the payment date only.
• B)The last day of the accounting period.
• C)On the declaration date.
• D)On the date of record.

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Definitions:

Negative Amortization

A situation in which the principal balance on a loan increases because the payments made do not cover the interest due.

Early Payments

Early payments are payments made before their due date, which can help reduce the amount of interest owed over time on loans.

Monthly Interest Charge

The amount charged by a lender to a borrower for the use of assets on a monthly basis, calculated as a percentage of the principal.

Real Rate

The interest rate that has been adjusted for inflation, reflecting the true cost of borrowing or the true yield on an investment.