Younger Company Has Outstanding Both Common Stock and Nonparticipating, Non-Cumulative

question 20

Multiple Choice

Younger Company has outstanding both common stock and nonparticipating, non-cumulative preferred stock. The liquidation value of the preferred is equal to its par value. The book value per share of the common stock is unaffected by

• A) the declaration of a stock dividend on preferred payable in preferred stock when the market price of the preferred is equal to its par value.
• B) the declaration of a stock dividend on common stock payable in common stock when the market price of the common is equal to its par value.
• C) the payment of a previously declared cash dividend on the common stock.
• D) a 2-for-1 split of the common stock.