A large stock dividend should be recorded on the basis of
A)par or stated value.
B)original issue price.
C)market value.
D)cost.

Question

Quizplus · Accepted Answer

A large stock dividend should be recorded based on the par or stated value of the stock, as this is the nominal value assigned to each share by the issuing company. This is in accordance with generally accepted accounting principles (GAAP) and is used to determine the amount of additional paid-in capital that should be recorded on the company's balance sheet. The original issue price, market value, and cost of the stock are not relevant in this case.

A Large Stock Dividend Should Be Recorded on the Basis