Asked by Emilee Wagner on May 04, 2024
Verified
Which of the following statements about dividends is not correct?
A) Cash dividends are generally declared quarterly as a dollar amount per share.
B) Dividends can be declared on both preferred and common shares.
C) The board of directors is obligated to declare dividends.
D) Dividends can be in cash or stock.
Cash Dividends
Payments made by a company out of its profits to its shareholders, typically in the form of cash.
Preferred Shares
A class of ownership in a corporation that has a higher claim on assets and earnings than common shares, usually with fixed dividends.
- Acquire knowledge about how stock splits and specific dividends do not influence retained earnings.
Verified Answer
NI
Nimra IshtiaqMay 09, 2024
Final Answer :
C
Explanation :
The board of directors is not obligated to declare dividends; it is at their discretion based on the company's profitability and financial health.
Learning Objectives
- Acquire knowledge about how stock splits and specific dividends do not influence retained earnings.