Direction: The following items consist of two statements, Statement I and Statement II. You are to examine these two statements carefully and select the answer to these items using the codes given below. Statement I Future financial requirement of the company influence dividend decision. Statement II During boom period, companies are usually in a race of increasing rate of dividend. Codes

• A.  Both statements are correct
• B.  Both statements are incorrect
• C.  Statement I is correct, but Statement II is incorrect
• D.  Statement I is incorrect, but Statement II is correct