Which of the Following Statements About Retained Earnings Restrictions Is

question 180

Multiple Choice

Which of the following statements about retained earnings restrictions is incorrect?

• A) Many jurisdictions require a corporation to restrict retained earnings for the cost of treasury shares purchased.
• B) Long-term debt contracts may impose a restriction on retained earnings as a condition for the loan.
• C) The board of directors of a corporation may voluntarily create retained earnings restrictions for specific purposes.
• D) Retained earnings restrictions are generally disclosed through a journal entry on the books of a company.

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Definitions:

Ovum

An egg, the female gamete or reproductive cell.

Cervical Erosion

A condition characterized by the appearance of red, inflamed areas on the cervix, often seen as an abrasion or erosion but usually without true tissue loss.

Intermenstrual Bleeding

Bleeding that occurs between the expected menstrual periods, often indicating an underlying medical condition.

Cervicitis

An inflammation of the cervix of the uterus.