Which of the Following Is True of Dividend Payments

question 7

Multiple Choice

Which of the following is true of dividend payments?

• A)Dividends have to be paid to shareholders even if paying them makes the company insolvent.
• B)A company cannot,in any case,distribute assets in the form of cash or property from capital surplus.
• C)A treasurer is bound to hand out cash to the shareholders if the board of directors declares a dividend payable on the date of the board meeting.
• D)A company can revoke a share dividend as long as the shares have not been issued.
• E)Directors have the discretion to declare and distribute dividends in excess of those allowed by the articles of incorporation without being liable to the corporation.

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Definitions:

Fuel Efficiency Standards

Regulations set by governments to mandate the minimum level of fuel economy vehicles must achieve to reduce fuel consumption and emissions.

Real Cost

The total cost of producing a good or service, including both direct and indirect costs.

Housing Costs

Expenses associated with owning or renting a home, including mortgage or rent payments, utilities, maintenance, and taxes.

CPI (Consumer Price Index)

An index that measures the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.