The Declaration and Payment of a Cash or Property Dividend

question 41

Multiple Choice

The declaration and payment of a cash or property dividend requires:

• A)the distribution of a current asset.
• B)an appropriation of retained earnings.
• C)a reduction of both retained earnings and assets.
• D)a decrease in retained earnings and a change in contributed (paid-in)capital.

---

Definitions:

Brake Fluid

Brake fluid is a type of hydraulic fluid used in brake and hydraulic clutch systems in vehicles, responsible for transferring force into pressure to stop the vehicle.

Pressure Differential Valve

Also known as brake warning light; used in hydraulic brake systems to indicate to the driver when one-half (primary or secondary circuit) of the system is not functioning. Consists of a cylinder inside of which is a spool valve.

Hydraulic Brake Circuit

A system in vehicles that uses pressurized hydraulic fluid to transfer force from the brake pedal to the brake mechanism at the wheels.

Mechanical Failure

The breakdown or malfunction of a mechanical system or component due to wear and tear, improper maintenance, or defect.