Which of the Following Statements About a Cash Dividend Is

Multiple Choice

Which of the following statements about a cash dividend is incorrect?

A) The legality of a cash dividend depends on state corporation laws.
B) The legality of a dividend does not indicate a company's ability to pay a dividend.
C) Dividends are not a liability until declared.
D) Shareholders usually vote to determine the amount of income to be distributed in the form of a dividend.