Dividends are generally treated as ordinary income for individual shareholders.
Dividends are a portion of profit paid to shareholders by a corporation as a reward for being an investor of the company. The portion of profit to be paid as dividend depends entirely upon the firm's growth policy.
Answer and Explanation:
This statement is true. Dividends, in general, are treated as ordinary income for shareholders whereas qualified dividends are treated as capital gains for tax purposes.
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from Accounting 302: Advanced AccountingChapter 12 / Lesson 2