Payment of dividends is a financing activity.

Name: Payment of dividends is a financing activity.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Payment of dividends represents the distribution of a portion of a company's profits to its shareholders, which reduces the company's retained earnings and cash resources. As it involves the allocation of funds between the company and its owners, payment of dividends is a financing activity under the cash flow statement.

Payment of Dividends Is a Financing Activity