Which part of shareholders' equity may not be used to pay cash dividends?
A) retained earnings
B) revenue reserves
C) share capital
D) A and B

Question

Quizplus · Accepted Answer

Share capital represents the amount of capital raised by the company through the issue of shares, and cannot be distributed as dividends. Retained earnings and revenue reserves, on the other hand, may be used to pay cash dividends, but the decision to do so is made by the company's management and board of directors.

Which Part of Shareholders' Equity May Not Be Used to Pay