Which of the Following Generally Does Not Influence the Dividend

question 52

Multiple Choice

Which of the following generally does not influence the dividend policy of the firm?

• A) Cash position of the firm
• B) Desire for control
• C) Seasonal changes in the level of income
• D) Investor's expectations of the future based on dividend policy

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Definitions:

Federal Income Tax

A tax levied by the United States federal government on the annual earnings of individuals, corporations, trusts, and other legal entities.

Sales Warranty Accrual Method

An accounting method where a company estimates the cost of warranty claims expected to arise from current sales and records this as an expense when the sale occurs.

Warranty Expense

The estimated cost of honoring product warranties, which companies recognize to match expenses with related revenues.

Estimated Warranty Costs

Projected expenses that a company expects to incur to repair or replace products during a warranty period.