The Account to Be Debited When a Stock Dividend Is

question 3

Multiple Choice

The account to be debited when a stock dividend is declared and distributed on the same date would be:

• A)Common Stock-Par Value.
• B)Retained Earnings.
• C)Cash.
• D)Paid-In Capital in Excess of Par-Common.

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Definitions:

TWX Call Option

An option contract that gives the holder the right, but not the obligation, to buy Time Warner Inc. (TWX) stock at a specified price within a certain time period.

Strike Price

The set price at which an option can be bought or sold when it is exercised.

Intrinsic Value

The actual, fundamental value of an asset, determined through analysis without reference to its market value.

Warrant

A security that gives the holder the right to purchase shares of stock at a fixed price over a given period of time.