To stockholders,the larger the net income,the greater the likelihood of dividends.

Question

Quizplus · Accepted Answer

Net income is the amount of profit left after deducting all expenses. A larger net income indicates that the company has made more profits, which increases the likelihood of the company paying dividends to its stockholders. Dividends are usually paid out of the company's profits, so higher profits mean that there is more money available for distribution. Therefore, the larger the net income, the greater the likelihood of dividends.

To Stockholders,the Larger the Net Income,the Greater the Likelihood of Dividends