Thecapitalimpairmentrestrictionsareestablishedto
A. reducedividendsequaltoorbelowthecurrentearningslevel.
B. constrainthefirmtopayingdividendswhichdonotrequireadditionalborrowing.
C. protecttheshareholder.
D. provideasufficientbasetoprotectcreditorsclaims.
Answer:D
Thecapitalimpairmentrestrictionsareestablishedto
A. reducedividendsequaltoorbelowthecurrentearningslevel. B. constrainthefirmtopayingdividendswhichdonotrequireadditionalborrowing. C. protecttheshareholder. D. provideasufficientbasetoprotectcreditorsclaims.