At the date of declaration of a small common stock dividend, the entry should not include
A) a credit to Common Stock.
B) a credit to Paid-in Capital in Excess of Par.
C) a debit to Retained Earnings.
D) All of these are acceptable.

Question

Quizplus · Accepted Answer

The entry for a small common stock dividend should include a credit to Paid-in Capital in Excess of Par and a debit to Retained Earnings, but not a credit to Common Stock since the dividend will be paid out of the company's additional paid-in capital and not from the common stock account.

At the Date of Declaration of a Small Common Stock