Which of the Following Is a TRUE Statement

question 28

Multiple Choice

Which of the following is a TRUE statement?

• A)A share dividend will increase total shareholders' equity but a share split will not.
• B)A share split will increase total shareholders' equity but a share dividend will not.
• C)Neither a share split nor a share dividend will increase total shareholders' equity.
• D)A share split will decrease retained earnings but a share dividend will not.

---

Definitions:

Profitable

A financial condition where income exceeds expenses resulting in a net gain.

Accounting Equation

The fundamental formula in accounting that states that assets equal liabilities plus equity.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting liabilities, representing owners' claims on the business.

Assets

Resources owned by a business or individual that have economic value and can provide future benefits.