When Closing the Income Summary Account When There Is a Net

question 14

Multiple Choice

When closing the Income Summary account when there is a net income:

• A) Capital would increase.
• B) Revenue would decrease.
• C) Capital would remain the same.
• D) None of these is correct.

Grasp the expectations theory in the context of dividend policy.

Learn the principles of the residual dividend theory.

Identify the influence of dividend preferences on investor choices between dividends and capital gains.

Recognize the limitations and flexibility in dividend payment policies.

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