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Dividends are a tax deductible expense once they have been paid. True False

Question:

Dividends are a tax deductible expense once they have been paid.

True

False

Dividend:

The dividend will be paid to the common shareholders after the level of net income is confirmed. However, some firms would not process the dividend to reinvest in other projects.

Answer and Explanation:

The answer is FALSE.

Dividends are not tax-deductible since they are paid out from the net income, which means it is not a qualified expense for the business.


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Cash Dividends & Dividend Payment

from Finance 101: Principles of Finance

Chapter 16 / Lesson 1
4.8K

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