Common stock dividends are declared by which of the following corporate actions?

Common stock dividends are declared by the Board of Directors, which is a critical corporate governance body responsible for making significant decisions on behalf of the shareholders. The Board evaluates the company’s financial performance, current earnings, and future forecasts to determine whether to declare a dividend, how much to pay, and when to distribute it. This decision reflects the company’s profitability and its commitment to returning value to shareholders.

The authority to declare dividends is specifically reserved for the Board, allowing them to ensure that the company can sustain its operations and growth plans while also rewarding shareholders. While shareholder votes can influence dividend policy, particularly in special situations or amendments to the company’s charter, the actual declaration of dividends rests solely with the Board. This centralizes decision-making and maintains accountability in managing the company's resources effectively.

In contrast, the other options—shareholder votes, market conditions, and debt agreements—may influence dividend policies and decisions indirectly but do not have the authority to declare dividends themselves. Shareholder votes might be necessary for specific corporate changes but are not routine for dividend declarations, while market conditions can impact the ability to pay dividends but do not dictate the decision. Debt agreements may impose restrictions on dividends but are not responsible for declaring them.