Declaration and distribution of a stock dividend cause each of the following effects except:

Name: Declaration and distribution of a stock dividend cause each of the following effects except:
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Declaration and distribution of a stock dividend do not cause a decrease in total assets of the issuing corporation. Instead, it transfers a portion of retained earnings to the equity section of the balance sheet by increasing the number of shares outstanding and the legal capital of the issuing corporation.

Declaration and Distribution of a Stock Dividend Cause Each of the Following