Which of the Following Is Not a Direct Result of a Stock

question 53

Multiple Choice

Which of the following is not a direct result of a stock dividend?

• A)the number of shares outstanding is increased
• B)the market price of each outstanding share is increased
• C)the amounts shown in the firm's capital accounts are redistributed
• D)the per-share price of the stock goes up

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Definitions:

New Shares

These are additional shares of stock issued by a company, expanding the total number of shares on the market and diluting existing shareholders' ownership unless they purchase more.

Shareholders of Record

Individuals or entities that are officially registered and listed as the owners of shares in a company as of the record date.

Payable

Refers to the amount of money a company owes to its creditors or suppliers, typically recorded as a current liability on its balance sheet.

Dividend Paid

The cash payment made by a corporation to its shareholders as a distribution of profits.