Question 14

No dividend can be paid unless so declared by the board of directors.

True

False

Question 15

Generally, a stock dividend is declared to improve the marketability of the shares by reducing the market price per share, increasing the number of shares outstanding, and making it possible to have a wider ownership of the stock.

True

False

Question 16

If a balance sheet is prepared between the date of declaration and date of payment, dividends payable accounts are reported as current liabilities.

True

False

Question 17

When a dividend is declared, Stock Dividends is debited and Cash is credited.

True

False

Question 18

Appropriation of retained earnings has been used primarily to limit the availability of retained earnings for paying stockholders' dividends.

True

False