A Stock Dividend Is a Pro Rata Distribution of Cash

question 45

True/False

A stock dividend is a pro rata distribution of cash to a corporation's stockholders.

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Definitions:

Balance Sheet

An accounting document that outlines an organization's resources, debts, and ownership interests on a certain date.

Transactions

Financial activities involving the exchange of goods, services, or funds between two parties.

Common Stock

A type of security that signifies holding an equity stake in a corporation, indicating ownership in the company.

Dividends

Profits paid out by a company to its stockholders, frequently as a distribution of earnings.