The Declaration and Issuance of a Stock Dividend Larger Than

question 38

Multiple Choice

The declaration and issuance of a stock dividend larger than 25% generally

• A) increases common shares outstanding and increases total shareholders' equity.
• B) increases retained earnings and increases total shareholders' equity.
• C) may increase or decrease common shares but does not change total shareholders' equity.
• D) decreases retained earnings but does not change total shareholders' equity.

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Definitions:

Average Sale Period

The average amount of time it takes for a business to sell its inventory, also known as inventory turnover period.

Maraby Corporation

A hypothetical or specific corporation named Maraby, details about it would depend on the context provided.

Year 2

Not a key term requiring a definition in the context provided.

Debt-to-Equity Ratio

A financial ratio that indicates the relative proportion of shareholders' equity and debt used to finance a company's assets.