On the Date of Record the Stock Price Drop Is

question 39

Multiple Choice

On the date of record the stock price drop is:

• A)a full adjustment for the dividend payment.
• B)a partial adjustment for the dividend payment because of the tax effect.
• C)zero because it happens on the ex-dividend date.
• D)zero because it happens on the payment date.
• E)None of the above.

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Definitions:

Multiple-Step Income Statement

An income statement that separates operating revenues and expenses from non-operating items to display key components of net income.

Sales Revenue

The gross income from selling products or services, prior to deducting any costs.

FOB Shipping Point

A shipping term indicating that the buyer is responsible for the goods and the shipping cost as soon as the goods leave the seller's premises.

FOB Destination

A shipping term indicating that the seller is responsible for the goods and the shipping cost until the goods reach the buyer's specified location.