If a firm adheres strictly to the residual dividend policy, the issuance of new common stock would suggest that
A. the dividend payout ratio is increasing.
B. no dividends were paid during the year.
C. the dividend payout ratio is decreasing.
D. the dollar amount of investments has decreased.
E. the dividend payout ratio has remained constant.
Answer: B
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Which of the following is a strong indicator that a material weakness in internal control exists?
A. Inadequate controls over the period-end financial reporting process. B. Inadequate controls over non-routine transactions. C. Restatement of previously issued financial statements to reflect a correction. D. Weaknesses in a control activity.
Which correlation coefficient suggests the strongest relationship?
a. +1 b. -0.1 c. 0 d. +0.5
Posterior probabilities are computed using
a. the classical method b. Chebyshev's theorem c. the empirical rule d. Bayes' theorem
If insurance coverage for the next two years is paid for in advance, the amount of the payment is debited to an asset account called Prepaid Insurance.
Answer the following statement true (T) or false (F)