The Characteristic Shared by All Liabilities Is That They

question 115

Multiple Choice

The characteristic shared by all liabilities is that they:

• A)provide a future economic benefit.
• B)result in an inflow of resources to the company.
• C)always end in the word "payable."
• D)obligate the company to do something in the future.

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Definitions:

Treasury Stock

Treasury stock refers to shares which were issued and later reacquired by the issuing company, reducing the amount of outstanding stock on the open market.

Cash Dividends

Payments made by a corporation to its shareholders, typically from profits, in the form of cash.

Retained Earnings

The portion of a company's profits that is kept or retained within the company, rather than being paid out as dividends to shareholders.

Shareholders Equity

The residual interest in the assets of a company after liabilities are deducted, effectively the net worth attributable to shareholders.