You are part of a group of students analyzing a company’s financial statements as part of a class project. At a team meeting, one of your group members makes the following statement: “If we are trying to determine the dividends that the company has declared, then we should see it reflected on the statement of income. If we want to determine if these dividends have been paid or not, then we should review the statement of financial position. Normally, the amount of dividends declared will be equal to a company’s earnings per share.”

Required
Evaluate your group member’s response. Identify the elements that are correct and incorrect. For any elements that are incorrect, explain why.