On January 1, 2009, the board of directors of Goby Inc. declared a $540,000 dividend. The following data are from the balance sheet of Goby on that date: How much is the liquidating dividend?

Question

Quizplus · Accepted Answer

A liquidating dividend is paid from capital rather than earnings. If the total dividend declared is $540,000 and the retained earnings available are $400,000, then the liquidating dividend is $540,000 - $400,000 = $140,000.

On January 1, 2009, the Board of Directors of Goby