Which of the Following Is Correct Regarding the Payment of Dividends

question 62

Multiple Choice

Which of the following is correct regarding the payment of dividends by a corporation?

• A)that it Dividends are tax deductible by the corporation once they have been declared.
• B)Dividends are paid out of net after-tax income and thus are tax deductible by the corporation in the following tax year.
• C)They Dividends are paid out of net after-tax income and thus are not tax deductible by the corporation.
• D)If dividends are paid after-tax bond interest they are tax deductible by the corporation.