Boston Free Press has a dividend policy whereby the firm pays a constant annual dividend of $2.40 per share of common stock. The firm has 1,000 shares of stock outstanding. The company:
A.
must always show a current liability of $2,400, ($2.40 × 1,000), for dividends payable.
B.
must declare each dividend before it becomes an actual company liability.
C.
is obligated to pay $2.40 per share each year in perpetuity.
D.
will be declared in default if it does not pay at least $2.40 per share per year on a timely basis.