31. The amount of a cash dividend liability is recorded on the date of record because it is on that date that the persons or entities who will receive the dividend are identified. 32. A 3-for-1...

31. The amount of a cash dividend liability is recorded on the date of record because it is on that date that the persons or entities who will receive the dividend are identified.

32. A 3-for-1 ordinary share split will increase total equity but reduce the par or stated value per share.

33. Unpaid dividends on non-cumulative preference shares are called dividends in arrears.

34. Net losses reduce the balance of Share Capital–Ordinary.

35. Retained earnings represents the amount of cash available for dividends.

36. Net income of a corporation should be closed to retained earnings and net losses should be closed to the share premium account.

37. A debit balance in the Retained Earnings account is identified as a deficit.

38. A correction in income of a prior period involves either a debit or credit to the Retained Earnings account.

39. Prior period adjustments to income are reported in the current year's income statement.

40. Retained earnings that are restricted are unavailable for dividends.