On August 31,2013,Victory Corporation's common stock is priced at $30 per share before any stock dividend or split,and the stockholders' equity section of its balance sheet appears as follows.Assume that the company declares and immediately distributes a 100% stock dividend.
-What is the total amount in the Common Stock account immediately after the stock dividend?
A)$266,000
B)$532,000
C)$1,140,000
D)$874,000
E)$0

Question

On August 31,2013,Victory Corporation's common stock is priced at $30 per share before any stock dividend or split,and the stockholders' equity section of its balance sheet appears as follows.Assume that the company declares and immediately distributes a 100% stock dividend.  
-What is the total amount in the Common Stock account immediately after the stock dividend?
A)$266,000 
B)$532,000 
C)$1,140,000 
D)$874,000 
E)$0

Quizplus · Accepted Answer

A stock dividend increases the common stock account by the par value of the additional shares issued. If the par value and the number of shares are such that the total becomes $532,000, then that is the correct amount.

On August 31,2013,Victory Corporation's Common Stock Is Priced at $30