On January 1, Hamblin Corporation Had 90,000 Shares of $10

question 176

Multiple Choice

On January 1, Hamblin Corporation had 90,000 shares of $10 par value common stock outstanding. On March 17 the company declared a 10% stock dividend to stockholders of record on March 20. Market value of the stock was $13 on March 17. The entry to record the transaction of March 17 would include a

• A) credit to Stock Dividends for $27,000.
• B) credit to Cash for $117,000.
• C) credit to Common Stock Dividends Distributable for $90,000.
• D) debit to Common Stock Dividends Distributable for $90,000.

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Definitions:

Marginal Costs

The change in total production cost that arises when the quantity produced is incremented by one unit, reflecting the cost of producing one additional unit of a good.

Incremental Costs

Costs that change or increase depending on the decisions made by a company, such as starting a new production process or producing more units of a product.

Fixed Costs

Expenses that do not change with the level of production or sales activities, such as rent or salaries.

Marginal Costs

The cost incurred by producing one additional unit of a good or service.