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

question 24

Multiple Choice

A company with 100,000 authorized shares of $4 par common stock issued 40,000 shares at $8. Subsequently, the company declared a 4% stock dividend on a date when the market price was $12 a share. What is the amount transferred from the Retained Earnings account to Paid-in Capital accounts as a result of the stock dividend?

• A) $12,800
• B) $19,200
• C) $32,000
• D) $48,800

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Definitions:

Esophagus

The muscular tube that moves food from the throat to the stomach.

Sphincter

A ring-like muscle that controls the passage of substances through an opening in the body, such as the anus or esophagus.

Peristalsis

The series of wave-like muscle contractions that moves food through the digestive tract.

Latissimus Dorsi

The large muscle of the back.