Payments to shareholders are called: Group of answer choices expenses. liabilities. dividends. liabilities.

Breakdown of the Problem

1. Identify the context of the question: payments made to shareholders.
2. Analyze the provided options to determine which one correctly describes payments to shareholders.

Relevant Concepts

• Expenses refer to the costs incurred by a company for its operational needs.
• Liabilities are obligations that a company must settle in the future, usually in the form of cash or services.
• Dividends are payments made to shareholders as a distribution of profit.

Analysis and Detail

1. Expenses: Payments to shareholders are not costs associated with operations, hence they are not classified as expenses.
2. Liabilities: While a company may have dividends payable as a liability before payment, the payments themselves are not liabilities.
3. Dividends: This term specifically refers to the distribution of earnings to shareholders, making it the correct answer.

Verify and Summarize

• The only term that accurately represents the nature of payments made to shareholders is "dividends."

Final Answer

Payments to shareholders are called dividends.