Questions: Multiple Choice Question A distribution of a company's accumulated prior earnings is a(n) expense retained earnings asset dividend

Multiple Choice Question A distribution of a company's accumulated prior earnings is a(n) expense retained earnings asset dividend
Transcript text: Multiple Choice Question A distribution of a company's accumulated prior earnings is a(n) $\qquad$ expense retained earnings asset dividend
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Solution

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Answer

The answer is dividend.

Explanation
Option 1: Expense

An expense is a cost incurred in the process of generating revenue. It is not related to the distribution of accumulated prior earnings.

Option 2: Retained earnings

Retained earnings refer to the portion of net income that is retained by the company rather than distributed to shareholders. It is not the distribution itself but rather the accumulated earnings that have not been paid out.

Option 3: Asset

An asset is a resource owned by a company that is expected to provide future economic benefits. It is not related to the distribution of prior earnings.

Option 4: Dividend

A dividend is a distribution of a company's accumulated prior earnings to its shareholders. This is the correct term for the distribution of retained earnings.

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