A Company Declared a Cash Dividend on Its Common Stock

question 70

Multiple Choice

A company declared a cash dividend on its common stock in December 2013,payable in January 2014.Retained Earnings would

• A) increase on the date of declaration.
• B) not be affected on the date of declaration.
• C) not be affected on the date of payment.
• D) decrease on the date of payment.

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Definitions:

Cooperative

An organization formed by individuals to market new products. Individuals in a cooperative pool their resources to gain an advantage in the market.

Crops

Plants cultivated by agriculturalists for use as food, feed, fiber, or fuel.

Trade Name

The name under which a business operates and is known to the public, distinct from the company's legal name.

Franchise

A business arrangement between an owner of a trade name or trademark and a person who sells goods or services under the trade name or trademark.