Which of the following should be considered when a company decides to declare a cash dividend on common stock?
A)The retained earnings balance only
B)The amount of authorized shares of common stock
C)The book value of the company's stock
D)The cash available and the retained earnings balance

Question

Quizplus · Accepted Answer

The cash available and retained earnings balance should be considered when declaring a cash dividend on common stock. Cash is necessary to pay the dividend, and the retained earnings balance is the source of the dividend payment. The amount of authorized shares of common stock and book value of the company's stock are not directly relevant to the decision to declare a cash dividend.

Which of the Following Should Be Considered When a Company