A company planning to pay a cash dividend in excess of the regular dividend does not want investors to believe that such an extra dividend will be repeated.What will the firm likely call this extra dividend?

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A special dividend is a one-time payment to shareholders that is separate from the regular dividend payout. The company can make it clear that it is a special, or one-time, dividend and not expected to be repeated in the future. This avoids creating an expectation of a higher regular dividend in the future, which could be difficult for the company to sustain. Option A, stock dividends, involve the distribution of additional shares instead of cash and are not relevant in this context. Option B, cash-liquidating dividends, are paid when a company is going out of business or selling off assets, and also do not apply in this scenario. Option D, residual dividends, refer to dividends paid after all required investments have been made, and are also not indicative of a one-time, special dividend.

A Company Planning to Pay a Cash Dividend in Excess