An East Coast Firm Should Establish a Lock-Box Service on the West

question 40

Multiple Choice

An East Coast firm should establish a lock-box service on the West Coast:

• A)if the firm has a large number of customers.
• B)if it has banking facilities in west coast.
• C)if West Coast customers are currently mailing their cheques to an East Coast address.
• D)if West Coast banks are more efficient.

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Definitions:

Compromise Dividend Policy

A dividend policy that seeks a balance between keeping shareholders happy with regular dividends and reinvesting earnings into the company.

Dividends

Payments made by a corporation to its shareholder members, usually derived from the company's profits.

Declaration Date

The Declaration Date is the date on which a company's board of directors announces its next dividend payment, specifying the dividend's size, ex-dividend date, and payment date.