Which of the Following Is Not True About a Stock

question 3

Multiple Choice

Which of the following is not true about a stock dividend?

• A)With a stock dividend,the firm issues a percentage of outstanding stock as new shares to existing shareholders.
• B)The overall effect of a stock dividend is to leave total stockholders' equity and each owner's share of stockholders' equity unchanged.
• C)In theory,with a stock dividend,total market value considering all outstanding shares should not change.
• D)Since the number of shares changes under a stock dividend,any ratio based on the number of shares must be restated.
• E)The accounting for a stock dividend,assuming the distribution is relatively small,requires that the par value of the stock be removed from retained earnings.

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Definitions:

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indicates the state of being conscious and aware of one's surroundings, in contrast to being asleep.

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A supplement form of melatonin, a hormone naturally produced by the pineal gland in the brain, used to regulate sleep-wake cycles or treat sleep disorders.