The company with the common equity accounts shown here has declared a 15 percent stock dividend when

Question:

The company with the common equity accounts shown here has declared a 15 percent stock dividend when the market value of its stock is $43 per share. What effects on the equity accounts will the distribution of the stock dividend have?

Common stock ($1 par value) ................. $ 385,000
Capital surplus ............................................. 846,000
Retained earnings .................................... 3,720,000
Total owners’ equity ............................. $ 4,951,000

Distribution
The word "distribution" has several meanings in the financial world, most of them pertaining to the payment of assets from a fund, account, or individual security to an investor or beneficiary. Retirement account distributions are among the most... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...

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