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Dividends receive preferential treatment when they become corporate income. True False

Question:

Dividends receive preferential treatment when they become corporate income.

True

False

Dividend:

Investing in equity, investors will receive two streams of money: dividends and capital gain. Dividends might be retained in the business for new expansion in the future.

Answer and Explanation:

The answer is FALSE.

The dividends paid to a corporation will be treated as an ordinary income and taxed at the current corporate tax bracket.


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Cash Dividends & Dividend Payment

from Finance 101: Principles of Finance

Chapter 16 / Lesson 1
4.8K

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