Manson World Reported the Following: Common Stock, $1 Par, 200,000

question 46

Multiple Choice

Manson World reported the following: Common stock, $1 par, 200,000 shares authorized, 100,000 shares issued and outstanding
What is the effect of a 2-for-1 stock split if the market value of the common stock is $20 per share when the stock split is declared?

• A) Retained earnings in the amount of $400,000 is transferred to the contributed capital accounts.
• B) Cash decreases $400,000.
• C) Additional Paid-in Capital increases $400,000.
• D) A stock split has no effect on total stockholders' equity.

---

Definitions:

Cultural Change

The modification of a society's cultural patterns, including norms, values, behaviors, and expressions.

Innovation

the introduction of new ideas, products, services, or processes that improve upon the existing state of art or knowledge.

Haptics

The study and use of touch communication, including how people perceive and convey messages through physical contact.

Nonverbal

Communication that occurs without words, using gestures, facial expressions, body language, and other visual cues to convey messages.