A corporation's distribution of new shares of stock to the corporation's current shareholders is called a ________.
A)cash dividend
B)liquidating dividend
C)stock dividend
D)stock split

Question

Quizplus · Accepted Answer

Stock dividends are the distribution of additional shares of stock to current shareholders. This is different from a cash dividend, which distributes a portion of the corporation's earnings as cash to shareholders. A liquidating dividend is the distribution of assets to shareholders when a corporation is liquidated or dissolved. A stock split occurs when a corporation increases the number of outstanding shares by issuing more shares to current shareholders, but the proportionate ownership in the corporation remains the same.

A Corporation's Distribution of New Shares of Stock to the Corporation's