A Liquidating Dividend Is

question 192

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)Not allowed under federal law.
• D)Only paid in assets other than cash.
• E)Only paid in shares of stock.

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Definitions:

Operating Cash Flow

A financial metric that represents the cash generated by a company's regular business operations in a specific time frame.

Comprehensive Income

Represents the total change in equity for a business enterprise during a period from transactions and other events and circumstances from non-owner sources. It includes all non-owner changes in equity, not just the net income.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life for accounting and tax purposes.

Net Working Capital

The gap between what a company owns in the short term (current assets) and what it owes (current liabilities), revealing its financial stability in the near term.