Which One of the Following Is Not Necessary in Order

question 51

Multiple Choice

Which one of the following is not necessary in order for a corporation to pay a cash dividend?

• A) Adequate cash
• B) Approval of shareholders
• C) Declaration of dividends by the board of directors
• D) Retained earnings

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Definitions:

Net Working Capital

A financial metric that measures a company's ability to pay off its current liabilities with its current assets.

Current Liabilities

Short-term financial obligations due within one year, typically including accounts payable, short-term loans, and accrued expenses.

Prompt Payment Discount

A reduction in the amount owed by a buyer to a seller, provided the payment is made within a specified timeframe.

Borrowing Rate

The interest rate charged by banks or financial institutions on loans to their customers.