Zeman,IncDeclares and Distributes a 10% Common Stock Dividend When It

question 150

Multiple Choice

Zeman,Inc.declares and distributes a 10% common stock dividend when it has 30,000 shares of $10 par value common stock outstanding.If the market value of the common stock is $30,the journal entry to record the stock dividend would include a:

• A)credit to Common Stock $120,000.
• B)credit to Common Stock $60,000.
• C)credit to Paid-in Capital in Excess of Par-Common $60,000.
• D)credit to Paid-in Capital in Excess of Par-Common $30,000.

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Definitions:

Endowments

The resources or assets that are provided to individuals or institutions which can generate income or have intrinsic value.

Competitive Pure Exchange Economy

An economic model where agents trade existing goods without the production of new goods, under perfect competition.

Initial Endowment

Refers to the initial allocation of goods, resources, or wealth that an individual or entity possesses before engaging in any transactions.

Diagonal Line

A straight line connecting two nonadjacent corners of a figure, such as a square or rectangle, or a line segment that runs across a geometric figure.