Which of the Following Statements Is True

question 181

Multiple Choice

Which of the following statements is true?

• A)Both a stock dividend and a stock split increase the balance in the common stock account.
• B)Both a stock dividend and a stock split reduce retained earnings.
• C)Neither a stock dividend nor a stock split will result in net gains or losses.
• D)A stock split increases the par value per share of the stock.

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Definitions:

Faithless Servant Doctrine

A legal principle that allows employers to recover compensation paid to an employee who has acted disloyally or in breach of contract.

Defendant Compensation

Financial or other forms of reparation awarded to a defendant, typically in civil lawsuits where the defendant may counter-claim against the plaintiff.

Plaintiff Forfeiture

A legal penalty where a plaintiff loses the right to claim certain benefits or privileges due to a failure to meet necessary legal requirements or actions.

Agency Relationship

A legal bond in which one person, the agent, acts on behalf of another, the principal, in transactions with third parties.