ACC 304 Course Great Wisdom / tutorialrank.com ACC 304 Course Great Wisdom / tutorialrank.com | Page 345

S35. Which of the following is not a legal restriction related
to profit distributions by a corporation?

a. The amount distributed to owners must be in compliance
with the state laws governing corporations.

b. The amount distributed in any one year can never exceed the
net income reported for that year.

c. Profit distributions must be formally approved by the board
of directors.

d. Dividends must be in full agreement with the capital stock
contracts as to preferences and participation.