luna misa earned $22,220,000 in after-tax profits last year. But it paid a dividend of $25,000,000 to its shareholders using its balance sheet cash. What is the result of the dividend payment? Its...

luna misa earned $22,220,000 in after-tax profits last year. But it paid a dividend of $25,000,000 to its shareholders using its balance sheet cash. What is the result of the dividend payment?

Its profit is reduced to zero.

Its book value is now higher by $2,780,000

Its cash positon is reduced by $2,780.000

Its profits tax is lower than it would have been if the dividend equaled $22,220,000.