The following statements are all true EXCEPT: A) dividends are paid f

The following statements are all true EXCEPT:

A) dividends are paid from net income.
B) dividends represent a use of cash and do not have to be paid if a firm has a net loss.
C) dividends are paid to a firm’s stockholders, both preferred and common stockholders, are tax-deductible to the paying company.
D) preferred stockholders, who are primarily investors seeking current income, usually receive dividends.

ANSWER

C