ACCA FA · Chapter 9 · Question 5 of 10
Where are dividends paid to ordinary shareholders presented in a company's financial statements?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) In the statement of changes in equity
Explanation
Ordinary dividends are a distribution to owners, not an expense, so they are deducted from retained earnings in the statement of changes in equity. They are not included in profit or loss or other comprehensive income. Cash paid would also appear in the statement of cash flows.
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