A Liquidating Dividend Is

question 30

Multiple Choice

A liquidating dividend is:

• A) Only declared when a corporation closes down.
• B) A return of a portion of the original investment back to the stockholders.
• C) Only paid in shares of stock.
• D) Only paid in assets other than cash.
• E) Not allowed under federal law.

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Definitions:

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within a year or within the operating cycle of the business, whichever is longer.

Ratio of Debt

A financial metric that measures the amount of debt a company has compared to its assets or equity, indicating the financial leverage or risk.

Accounting System

A systematic process of recording, reporting, and analyzing financial transactions of a business.

Data from Source Documents

Information collected from original records or documents used for analysis or decision-making.