(Topic 2) If a corporation pays 70% of its current earnings to its stockholders in the form of cash dividends, the remaining 30% kept by the company will cause a(n):

The correct answer is D. concentrate cash on a regular basis. A national retailer's cash management system includes a field deposit system using multiple banks. To limit the impact of a failure of one of these banks, a cash manager

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Question

(Topic 2)

If a corporation pays 70% of its current earnings to its stockholders in the form of cash dividends, the remaining 30% kept by the company will cause a(n):

Options

Aconsolidate all accounts at one bank.
Buse wire transfers for concentration.
Cmonitor each bank's credit policies.
Dconcentrate cash on a regular basis.

How the community answered

(37 responses)

A
14% (5)
B
3% (1)
C
5% (2)
D
78% (29)

Explanation

A national retailer's cash management system includes a field deposit system using multiple banks. To limit the impact of a failure of one of these banks, a cash manager

Topics

#retained earnings#dividends#cash concentration#payout ratio

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