Asked by Teyanna Meshae on Jun 10, 2024
Verified
Dividends are subtracted as expenses in the calculation of net income.
Dividends
Payments made to shareholders out of a company's earnings, distributing a portion of the profit to investors as a return on their investment.
Net Income
The company's residual earnings post all expenditures and tax deductions from the gross revenue.
- Comprehend the principles surrounding net income, net loss, and their effects on equity.
Verified Answer
MD
Mishumo DzhivhuhoJun 16, 2024
Final Answer :
False
Explanation :
Dividends are not considered as expenses and are not subtracted in the calculation of net income. Instead, they are a distribution of profits to shareholders after all expenses including taxes have been paid.
Learning Objectives
- Comprehend the principles surrounding net income, net loss, and their effects on equity.