The per share amount normally assigned by the board of directors to a large stock dividend is
A) the market value of the stock on the date of declaration.
B) the average price paid by stockholders on outstanding shares.
C) the par or stated value of the stock.
D) zero.

Question

Quizplus · Accepted Answer

The per share amount assigned by the board of directors to a large stock dividend is usually the par or stated value of the stock. This is because the stock dividend does not result in an actual inflow of cash to the company, rather it is a transfer of equity among shareholders. Therefore, assigning the par or stated value ensures that the company's accounting records accurately reflect the change in ownership without affecting the company's financial position.

The Per Share Amount Normally Assigned by the Board of Directors