Zarooda Inc. has the following balances on its balance sheet: total assets of $50,000 (including cash of $6,000), total liabilities of $42,000, common stock of $5,000 and retained earnings of $3,000. What is the maximum amount of cash dividends that the company can pay? a. $50,000 b. $6,000 c. $3,000 d. $8,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Zarooda Inc. has the following balances on its balance sheet: total assets of $50,000 (including cash of $6,000), total liabilities of $42,000, common stock of $5,000 and retained earnings of $3,000. What is the maximum amount of cash dividends that the company can pay?

a. $50,000

b. $6,000

c. $3,000

d. $8,000

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