The amount of money that can be distributed to shareholders as a return of capital, without being a return on capital, is the capital financial concept.

Question

Quizplus · Accepted Answer

The statement confuses the terms. A return of capital reduces the invested capital in the business and is not considered a return on capital, which refers to the profit made on the investment. The concept described seems to mix elements of both without accurately defining a recognized financial concept.

The Amount of Money That Can Be Distributed to Shareholders