When Stock Dividends Are Distributed

question 91

Multiple Choice

When stock dividends are distributed

• A) Common Stock Dividends Distributable is decreased.
• B) Retained Earnings is decreased.
• C) Paid-in Capital in Excess of Par is debited if it is a small stock dividend.
• D) no entry is necessary if it is a large stock dividend.

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Definitions:

Purchasing Inventory

The process of acquiring goods and materials that a business sells or uses in its production process, an essential component of supply chain management.

Fixed Asset Sale

The process of selling long-term assets, such as property, plant, and equipment, for cash or other compensation.

Cash Increase

A rise in the amount of cash and cash equivalents held by a business.

Accounts Payable

Liabilities of a business representing money owed to creditors for goods and services purchased on credit.