Which of the following statements is FALSE?
A)With a stock dividend,a firm does not pay out any cash to shareholders.As a result,the total market value of the firm's assets and liabilities,and therefore of its equity,is unchanged.
B)If the price of the stock falls too low,a company can engage in a reverse split and reduce the number of shares outstanding.
C)Stock dividends of 50% or higher are generally referred to as stock splits.
D)Rather than pay a dividend using cash or shares of its own stock,a firm can also distribute shares of a subsidiary in a transaction referred to as a off-shoot.

Question

Quizplus · Accepted Answer

The correct term for distributing shares of a subsidiary is a "spin-off," not an "off-shoot." This process involves a parent company distributing shares of a subsidiary to its shareholders, effectively creating a separate company.

Which of the Following Statements Is FALSE