The Declaration of Cash Dividends Increases Retained Earnings

question 72

True/False

The declaration of cash dividends increases retained earnings.

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Definitions:

Amortization

The process of spreading out a loan into a series of fixed payments over time, accounting for both principal and interest.

Capital Expenditures

Funds spent by a company to acquire or upgrade physical assets such as equipment or property.

Profits After Tax

The net income a company retains after paying all its taxes.

Cost Structure

The composition of fixed and variable costs that a company incurs in the process of delivering goods and services.