Multiple Choice
Dora Company declared and distributed a 10% stock dividend on 20,000 shares of issued and outstanding $5 par value common stock. The market price per share was $9 on the declaration date. Which of the following correctly describes the effect of accounting for the declaration and distribution of the stock dividend?
A) Retained earnings decreased $10,000.
B) Additional paid-in capital increased $8,000.
C) Common stock increased $1,000.
D) Retained earnings decreased $18,000.
Correct Answer:
Verified
Correct Answer:
Verified
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