Placing a Restriction on Retained Earnings Will

question 185

Multiple Choice

Placing a restriction on retained earnings will

• A)assure that a company has sufficient cash for a specific purpose.
• B)increase total stockholders' equity.
• C)communicate to readers a portion of retained earnings is unavailable for dividends.
• D)decrease total stockholders' equity.

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Definitions:

Petty Cash Fund

A small amount of cash kept on hand for minor, incidental expenses.

Mail and Postage

Expenses associated with sending mail and packages, including the cost of stamps and shipping fees.

Missing Funds

A situation where there is a discrepancy in expected and actual cash or assets, indicating possible errors or theft.

Journal Entry

The act of recording a transaction into the financial records of a company, detailing debits and credits in an accounting journal.