The Purpose of a Retained Earnings Appropriation Is to Inform

question 11

Multiple Choice

The purpose of a retained earnings appropriation is to inform readers of the balance sheet that

• A) the appropriated amount is unavailable for dividends.
• B) such an appropriation is required to pay corporate income taxes.
• C) an appropriation is needed because the corporation expects a net loss for the year.
• D) an appropriation is needed because the corporation is involved in a lawsuit.

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Definitions:

Esteem Needs

The need for respect—both self-respect and respect from others.