SIE practice questionmediumDividends
Which statement about dividends is correct?
- ADividends are not legally required and can be changed at any time by the board.✓ Correct answer
- BDividends must be paid out of new share proceeds.
- CDividends are always paid monthly.
- DDividends must be paid if the company is profitable.
Explanation
Why A — Dividends are not legally required and can be changed at any time by the board.
Dividends are at the discretion of the board and not mandatory. They are not paid from share sales, and their timing/profit link is not guaranteed.
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