Each of the Following Factors May Cause a Corporation to Lower

question 1

Multiple Choice

Each of the following factors may cause a corporation to lower its dividend payout ratio EXCEPT

• A) the corporation's earnings predictability is high.
• B) the corporation's current and quick ratios are higher than industry average.
• C) the corporation's retained earnings balance is high.
• D) current common shareholders are unable to participate in new equity offerings.

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Definitions:

Standard Costing System

A cost accounting method that assigns expected costs to products, services, or cost units, used for budgeting and performance evaluation.

Direct Labour Hours

The total hours worked by employees who are directly involved in the production process, often used as a basis for allocating labor costs to products.

Activity-Based Costing

An accounting method that assigns costs to products or services based on the activities they require, for more accurate product costing.

Activity Costs

Expenses associated with specific activities within a manufacturing or service delivery process, including labor, materials, and overhead.