CGI Corporation had 10,000 shares of $2 par common stock outstanding; the shares had been issued at $5 per share. At the end of March 2011, CGI declared a $3 cash dividend per share when the market price of the stock was $8 per share. Which of the following statements is most true?

Question

Quizplus · Accepted Answer

The $3 cash dividend per share is not determined by the difference between issuance price, market value, or par value. Dividends are typically determined by the company's board of directors based on profitability and cash flow, not these differences.

CGI Corporation Had 10,000 Shares of $2 Par Common Stock