The declaration of a cash dividend causes shareholders' equity to decrease but has no immediate effect upon corporate assets.

Name: The declaration of a cash dividend causes shareholders' equity to decrease but has no immediate effect upon corporate assets.
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Question

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The declaration of a cash dividend results in a reduction of retained earnings, which is a component of shareholders' equity. However, it does not have an immediate effect on corporate assets.

The Declaration of a Cash Dividend Causes Shareholders' Equity to Decrease