Corporations Generally Issue Stock Dividends in Order to

question 46

Multiple Choice

Corporations generally issue stock dividends in order to

• A) increase the market price per share.
• B) exceed stockholders' dividend expectations.
• C) increase the marketability of the stock.
• D) decrease the amount of capital in the corporation.

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Definitions:

Perpetual Inventory System

A method where inventory quantities and cost of goods sold amounts are updated continuously as sales occur and purchases are made.

Lower-of-cost-or-market

An accounting principle that values inventory at the lower of its historical cost or current market price.

Average Cost

A method of inventory valuation that calculates the cost of goods sold and ending inventory based on the weighted average of all units purchased.