On which of the following dates, a company incurs liability for a dividend?

Question

Quizplus · Accepted Answer

A company incurs liability for a dividend on the date of declaration. This is the date on which the company's board of directors approves the payment of a dividend to shareholders. The date of record is simply a cutoff date for determining which shareholders are eligible to receive the dividend, and the date of payment is when the dividend is actually paid out to those shareholders. The date of liquidation is not relevant to dividend payments.

On Which of the Following Dates, a Company Incurs Liability