Which of the Following Is True of a Stock Dividend

question 219

Multiple Choice

Which of the following is true of a stock dividend?

• A) Transfers a portion of equity from retained earnings to a cash reserve account.
• B) The decision to declare a stock dividend resides with the shareholders.
• C) Reduces a corporation's assets and stockholders' equity.
• D) It is a liability on the balance sheet.
• E) Does not affect total equity, but transfer amounts between the components of equity.

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