Which of the following statements is NOT correct? A) stockholders pay no income tax on dividends...
Which of the following statements is NOT correct?
A) stockholders pay no income tax on dividends if the dividends are used to purchase stock through a dividend reinvestment plan
B) Companies can repurchase shares to distribute large inflows of cash, say from the sale of a division, to stockholders without paying cash dividends
C) investors can interpret a stock repurchase program as a signal that the firm's managers believe the stock is undervalued
D) After a 3-for-1 stock split, a company's price per share should fall, but the number of shares outstanding will rise
Homework Answers
Option A.
Stockholders will have to pay income tax on dividends even if the dividends are used to purchase stock through a dividend reinvestment plan.
Add Answer to:
Which of the following statements is NOT correct?
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