The Use of Stock Dividends by Industries in the Growth

question 14

Multiple Choice

The use of stock dividends by industries in the growth stage is for what purpose?

• A)To dilute the ownership of current holders of equity
• B)To maintain cash to pay off creditors
• C)To signal to investors that the company is profitable
• D)Because cash dividends would signal to investors that the company has reached the crossover point

---

Definitions:

Manufacturing Departments

Specialized sections within a manufacturing facility responsible for different stages of product production, such as assembly, finishing, or quality control.

Machine-Hours

This measure indicates the collective operational duration of machinery used in manufacturing or production processes over a specified timeframe.

Manufacturing Overhead

All indirect costs associated with manufacturing, excluding direct materials and direct labor, such as utilities, maintenance, and factory supplies.

Job-Order Costing System

An accounting system used to track the costs associated with producing specific jobs or batches, useful for customized orders.