 In this presentation, we will take a look at multiple choice questions related to corporations. First question, vote to declare and pay a dividend a date of dividends, b date of declaration, c date of record, d date of payment, and e date of liquidation. We will go through this again using the process of elimination in order to narrow this down. Vote to declare and pay dividends, a date of dividend, maybe sounds nice to have the two D's in there sounds interesting, B says I'm going to keep that for now, B says date of declaration, again also sounds pretty neat sounds like it could be the case if we're going to declare something and we're declaring dividends and it's either the date of the dividend or the date of the declaration. So those two sound reasonable, C says date of record, you know it could sound reasonable as well I'll keep that for now, D says date of payment and the declaration date we could probably say even if we don't really know much we could say that's going to be different than possibly the payment date, so I'm going to say that's probably not it, E says date of liquidation and that's that looks like just an answer that they didn't know what else to put there because they didn't have any more dates of dividend related type sounding things because the liquidation would mean we closed the whole company so it doesn't sound like he just looks way out there we can cross that one out so we're left with A, B, and C we'll go through this again, vote to declare and pay dividends is either A, B, or C either date of dividends or date of declaration or date of record now of these three I think the first two sound you know closest to what we're talking about says vote to declare and pay dividends either that's the date of the dividend or the date of declaration and of those two I think B sounds most proper because it actually says in the question that we are declaring that we're going to have the dividends so B is it that's the final answer and just note that when you think about dividends there's going to be three dates so there's the date of declaration the date of record just means that that's whoever owns the stock at that point is going to get the dividend if there's trading stocks whoever owned it at the date of record it's the one that's going to get paid the dividend and then the date of payment when we actually pay the dividend final answer vote to declare and pay dividend B date of declaration next question liability for dividends happens a date of dividends B date of declaration C date of record D date of payment E date of liquidation so we got the same answers here we didn't notice that same answers but different question go through it again process of elimination liability for dividends happens either a date of dividends so again I'll keep that for now and B says date of declaration I'll keep that for now actually from the last question we can see that the date of dividends if we stay consistent isn't anything right it's the date of declaration is the proper term not the date of dividends doesn't that's not really a thing it's not really a date of dividends C says date of record now that is one of the three dates remember there's a date of declaration there's a date of record and then C says there's a date of payment and that is one of the three dates there's three dates related to dividends so I'll keep BC and D because those all those represent the three dates that have to do with dividends E says date of liquidation which again that sounds just kind of out there that liquidation has nothing to do with dividends did you Scott they didn't have anything else to put there apparently so we're left with BC and D we'll go through it again liability for dividends happens either BC or D either date of declaration or date of record or date of payment so when when there's a liability that's happening here why would a liability happen with a dividend what is a dividend that means we're gonna pay out part of the earnings that the corporation has earned to the owners to the stockholders so why would that create a liability at all because there's gonna be some kind of bureaucratic process to do that meaning we can't just at the same date decide we're gonna have a dividend and pay it today we have because it's a corporation it's a bureaucracy we got to say okay we're gonna decide to pay it then we're gonna say who's gonna get paid based on whatever date whoever owns the dividend the corporate stock at that time then we're gonna pay it so if that's the case then the liability happens when we decide to pay it because that's when we're gonna basically debit retained earnings or debit dividends whatever whether we're gonna break it out as a dividend and then close it out or just take it out of retained earnings lowering retained earnings with a debit and then we're gonna credit the liability some kind of dividend payable at that time which we will then take away will lower the liability when we make the payment here so these the correct answer final answer liability for dividends that happens be date of declaration