Declaring and Paying Dividends Causes an Increase in Both Assets

question 188

True/False

Declaring and paying dividends causes an increase in both assets and stockholders' equity of the corporation.

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Definitions:

Interest Expense

The financial charge for an entity using borrowed capital over a time frame.

Notes Payable

Short-term or long-term liabilities representing amounts owed on written promises to pay a specific sum of money at a future date.

Market Rate

The current price or cost of a good, service, or financial asset in the marketplace, determined by supply and demand dynamics.

Par Value

The nominal dollar amount assigned to a security by the issuer.