Which of the Following Statements Is Incorrect

question 35

Multiple Choice

Which of the following statements is incorrect?

• A) Dividend yield measures the rate of return on the market price of a share.
• B) Dividend yield is an important ratio for an investor who is acquiring shares mainly for income.
• C) The dividend payout ratio measures the percentage of profit paid out in dividends to ordinary shareholders.
• D) Dividend per share is the ratio to use when comparing income from shares with income from alternative investments.

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Definitions:

Master Budget

A comprehensive financial planning document that consolidates all of a company's budgets, including sales, production, and various operational budgets.

Credit Sales

Transactions in which goods or services are provided to a customer with the agreement that payment will be made at a later date.

Accounts Receivable

The money owed to a company by its customers for goods or services that have been delivered but not yet paid for.

Cash Collections

The process of gathering all payments or receivables a company has earned from its sales or services.