The portion of a corporation's net income that is paid out to the stockholders, instead of being retained in the business, is referred to as:
A) gross income.
B) earnings before interest and taxes.
C) interest expense.
D) dividends.

Question

Quizplus · Accepted Answer

Dividends are the portion of a corporation's net income that is distributed to its shareholders as a way of sharing profits. This amount is decided by the corporation's board of directors and is usually paid out quarterly or annually.

The Portion of a Corporation's Net Income That Is Paid