A Company with 100,000 Authorized Shares of $4 Par Common

question 71

Multiple Choice

A company with 100,000 authorized shares of $4 par common stock issued 50,000 shares at $9. Subsequently, the company declared a 2% stock dividend on a date when the market price was $10 a share. The effect of the declaration and issuance of the stock dividend is to

• A) decrease retained earnings, increase common stock, and increase paid-in capital
• B) increase retained earnings, decrease common stock, and decrease paid-in capital
• C) increase retained earnings, decrease common stock, and increase paid-in capital
• D) decrease retained earnings, increase common stock, and decrease paid-in capital

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Definitions:

Interpersonal Influence

The ability to affect or change others' behaviors, attitudes, or opinions through communication and social interaction.

Networking Ability

The skill in building and maintaining professional relationships that can provide support, information, and resources.

Perceived Sincerity

The extent to which an audience believes an individual's actions or statements are genuine and not manipulative.

Double-Edged Sword

A situation or decision that has both positive and negative potential outcomes.