Which of the Following Statements Regarding the Date of a Cash

question 158

Multiple Choice

Which of the following statements regarding the date of a cash dividend declaration is not accurate?

• A)The dividend can be rescinded once it has been declared.
• B)The corporation is committed to a legal, binding obligation.
• C)The board of directors formally authorizes the cash dividend.
• D)A liability account must be increased.

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Definitions:

Investing Activities

Financial transactions related to the acquisition or sale of long-term assets and other investments not considered cash equivalents.

Direct Method

An accounting practice for presenting cash flows from operating activities by listing major classes of gross cash receipts and payments.

Operating Activities

Business actions involving the primary operations and transactions of a company.

Taxes Payable

The amount of tax liability a company owes to the government but has not yet paid; it appears as a liability on the balance sheet.