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WAEC Financial Accounting 1999 Question 25

Question 25

Company Accounts

Dividend proposed by a company is shown in its Balance Sheet as

  1. A.current asset
  2. B.current liability
  3. C.long-term liability
  4. D.fixed asset.
Show the answer and explanation

Answer: B (current liability)

Explanation

A proposed dividend will be paid to shareholders soon, so it is a current liability.