A Company Has Not Declared a Dividend on Its Cumulative

question 55

Multiple Choice

A company has not declared a dividend on its cumulative preference shares for the past three years.What is the required accounting treatment or disclosure in this situation?

• A)Record a liability for cumulative amount of preference shares dividends not declared.
• B)Disclose the amount of the dividends in arrears.
• C)Record a liability for the current year's dividends only.
• D)No disclosure or recognition is required.

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Definitions:

Nonparametric Methods

Statistical techniques that do not assume a specific distribution for the data, often used when data do not meet the assumptions of parametric tests.

Wilcoxon Rank Sum Procedure

A nonparametric test used to compare two independent samples to determine if they come from the same distribution.

Wilcoxon Rank Sum Test

A nonparametric test that compares two independent samples to determine if they come from the same distribution.

Liquid Dispensed

The volume of fluid distributed or allocated by a dispenser mechanism or device.