Which of the Following Statements Is NOT Generally True About

Multiple Choice

Which of the following statements is NOT generally true about the legality of dividend distributions?

A) No amounts may be distributed unless the corporate capital is left intact.
B) The corporation must still be able to pay its liabilities when they become due.
C) A corporation may not pay dividends that are higher than their legally available retained earnings.
D) Dividends do not need to be formally approved by the Board of Directors.