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If a "typical" firm reports $10 million...
This question was answered on Jun 11, 2010. View the Answer
If a "typical" firm reports $10 million of retained earnings on its balance sheet, could its directors declare a $10 million cash dividend without any qualms whatsoever?(Hint: Remember dividend have to be paid in CASH).

Please cite answers that are not original.

PFA solution. View the full answer

6258938_FIN.docx

Answer:
No, it is not practically feasible for a firm to declare all the retained
earnings in form of cash dividends due to the following reasons;
The firm should have a cash balance of $10...

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