Which of the Following Statements About Dividends Is Not Correct

question 87

Multiple Choice

Which of the following statements about dividends is not correct?

• A)Dividends represent a sharing of corporate profits with owners.
• B)Both stock dividends and cash dividends reduce Retained Earnings.
• C)Cash dividends paid to stockholders reduce net income.
• D)Dividends are declared at the discretion of the board of directors.

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Definitions:

Reactance

The opposition that inductors and capacitors present to the flow of alternating current, characterized by its effect on the phase of the current.

Resistance

A material's opposition to the flow of electric current, measured in ohms.

Self-induction

The property of a circuit or coil that causes it to induce a voltage in itself as a result of a change in current flow, affecting the circuit's own current.

Electro-magnetism

A branch of physics involving the study of electromagnetic forces generated by the interaction between electric charges and currents.