A stock dividend will cause a decrease in total contributed capital at the date the dividend is declared.

Name: A stock dividend will cause a decrease in total contributed capital at the date the dividend is declared.
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Question

Quizplus · Accepted Answer

A stock dividend does not result in a decrease in total contributed capital. Instead, it results in a transfer of retained earnings to the capital stock account, leading to an increase in the number of shares outstanding without any change to the total contributed capital.

A Stock Dividend Will Cause a Decrease in Total Contributed