Which of the Following Is the Correct Description of Dividends

question 11

Multiple Choice

Which of the following is the correct description of dividends in arrears?

• A) the cumulative amount of dividends that were not paid in previous years
• B) the cumulative amount of dividends that were paid in previous years
• C) the amount of dividends that were paid after the payment date
• D) the amount of dividends that will be paid in the next year

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Definitions:

Consignment

A business arrangement where goods are left in the possession of another party to sell, but ownership remains with the supplier until sold.

F.O.B. Destination

Seller pays or is responsible for the cost of freight to purchaser’s location or destination.

FIFO Method

First-In, First-Out method, an inventory valuation method where the first items purchased are the first ones sold, used in calculating cost of goods sold.

Ending Inventory

The value of goods available for sale at the end of an accounting period, calculated as beginning inventory plus purchases minus cost of goods sold.