If a Corporation Distributes Cash to Its Shareholders, Then

question 206

Multiple Choice

If a corporation distributes cash to its shareholders, then

• A) there has been a violation of accounting principles.
• B) equity will increase.
• C) equity will decrease.
• D) there will be a new liability showing the shareholders owe money to the business.

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Definitions:

Self-Efficacy

A person's confidence in their ability to perform tasks that lead to certain desired outcomes.

Mastery

The process of acquiring comprehensive knowledge or skill in a subject or activity, often leading to improved performance and a sense of achievement.

Drive-Reduction

A motivational concept suggesting that humans act to alleviate physical or psychological needs, aiming at maintaining homeostasis.

Safety

The state of being safeguarded against or not prone to causing harm, peril, or damage.