Which Statement About "Stock Dividends" Is Correct

question 67

Multiple Choice

Which statement about "stock dividends" is correct?

• A)Only a memo entry is needed for this transaction.
• B)No entry is needed in the accounting records.
• C)A journal entry is needed for this transaction.
• D)This is the same as a stock split for accounting purposes.

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Definitions:

FIFO Method

A technique for inventory valuation and cost determination where goods first introduced into inventory are the first to be sold.

Process Costing System

An accounting method used for homogeneous products, where costs are assigned to processes or departments and averaged over the units produced.

Weighted Average Method

An inventory costing method that calculates the cost of goods sold and ending inventory based on the weighted average cost of all goods available for sale.

Finished Goods

Items that have been fully produced but are still awaiting sale or distribution to buyers.