Which One of the Following Statements Related to Cash Dividends

question 75

Multiple Choice

Which one of the following statements related to cash dividends is correct?

• A)Extra cash dividends cannot be repeated in the future.
• B)A dividend is never a liability until it has been declared.
• C)If a firm has paid regular quarterly dividends for at least five consecutive years it is legally obligated to continue doing so.
• D)Regular cash dividends reduce paid-in capital.
• E)The dividend yield expresses the annual dividend as a percentage of net income.

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Definitions:

Type-I Survivorship

A survivorship curve characterized by high survival rates of the young and middle-aged, with most mortality occurring among the elderly.

Surviving

Surviving refers to the act or process of continuing to live or exist, especially in spite of challenging circumstances or threats to existence.

R-Selected Species

Species characterized by high reproductive rates, short lifespans, and a focus on quantity of offspring rather than quality.

Lifespan

The maximum duration of life for an individual of a species.