Question
Starr Company has outstanding both common stock and nonparticipating, non- cumulative preferred stock. The liquidation value of the preferred is equal to its par value.
Starr Company has outstanding both common stock and nonparticipating, non-
cumulative preferred stock. The liquidation value of the preferred is equal to its
par value. The book value per share of the common stock is unaffected by
a.the declaration of a stock dividend on preferred payable in preferred stock when the market price of the preferred is equal to its par value.
b.the declaration of a stock dividend on common stock payable in common stock when the market price of the common is equal to its par value.
c.the payment of a previously declared cash dividend on the common stock.
d.a 2-for-1 split of the common stock.
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