Which of the following correctly describes the effect of Mogul Company declaring and distributing a 10% common stock dividend?
A)Mogul's current ratio decreased.
B)Mogul's return on equity ratio decreased.
C)Mogul's debt-to-equity ratio remained the same.
D)Mogul's return on assets decreased.

Question

Quizplus · Accepted Answer

Declaring and distributing a common stock dividend does not affect the company's debt-to-equity ratio since it does not involve taking on any additional debt. The current ratio, return on equity ratio, and return on assets may be affected, but the question does not provide enough information to determine the specific impact.

Which of the Following Correctly Describes the Effect of Mogul