If a Firm Has Retained Earnings of $20 Million, a Common

question 66

Multiple Choice

If a firm has retained earnings of $20 million, a common shares account of $25 million, and additional paid-in-capital of $15 million, how much would be transferred in (or out) of these accounts in response to a 15 percent stock dividend, respectively?

• A) − 15 percent, 0 percent, + 15 percent
• B) − 15 percent, + 15 percent, 0 percent
• C) − 30 percent, + 15 percent, + 15 percent
• D) − 30 percent, + 30 percent, + 30 percent