Which of the Following Represents a Legal Restriction on the Payment

Multiple Choice

Which of the following represents a legal restriction on the payment of dividends?

A) The dividend must be paid prior to the ex-dividend date.
B) The total dividend cannot exceed shareholders' equity.
C) A loan covenant which restricts the dividend to 10% of net income.
D) A stock dividend is restricted to Canadian shareholders.
E) A takeover threat limits the dividend a company can pay.