Dora Company Declared and Distributed a 10% Stock Dividend on 20,000

question 80

Multiple Choice

Dora Company declared and distributed a 10% stock dividend on 20,000 shares of issued and outstanding $5 par value common stock.The market price per share was $9 on the declaration date.Which of the following correctly describes the effect of accounting for the declaration and distribution of the stock dividend?

• A)Retained earnings decreased $10,000.
• B)Additional paid-in capital increased $8,000.
• C)Common stock increased $1,000.
• D)Retained earnings decreased $8,000.

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Definitions:

Visual Perception

The ability to interpret the surrounding environment by processing information contained in visible light.

Observer Characteristics

Refers to the traits or attributes of an individual observing a situation or phenomenon, which can influence their perceptions and interpretations.

Perception

The process by which sensory information is interpreted and organized in the brain to understand and interact with the environment.

Depolarize

The process by which a cell, such as a neuron, decreases its electrical charge, often making it more likely to produce an electrical signal.