Distributions to Shareholders from Capital Are Called

question 32

Multiple Choice

Distributions to shareholders from capital are called:

• A) earnings dividends.
• B) a stock split.
• C) liquidating dividends.
• D) stock dividends.
• E) regular cash dividends.

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Definitions:

Current Asset

An asset that is expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of a business.

Cash Dividends

Payments made by a corporation to its shareholder members from the company's current or retained earnings.

Capital Stock

Reflects the amount of equity financing a company has generated through the sale of its shares to investors.

Financing Activities

Transactions and events whereby resources are obtained from, or repaid to, owners (equity financing) or creditors (debt financing).