The dividends payable liability of the corporation is eliminated:

Question

Quizplus · Accepted Answer

The dividends payable liability is eliminated when the dividends are actually paid out to the shareholders, which happens on the payment date. Therefore, choice A is the correct answer. The date of record is the date on which shareholders who are entitled to the dividend are determined, and the declaration date is the date on which the company officially declares the dividend. However, these dates do not affect the elimination of the dividends payable liability.

The Dividends Payable Liability of the Corporation Is Eliminated