The declaration and issuance of a common stock dividend:
A)Does not change the internal content of retained earnings.
B)Decreases total owners' equity and increases the related common stock account.
C)Decreases assets and decreases total owner's equity.
D)Does not change assets, liabilities or total owners' equity.

Question

Quizplus · Accepted Answer

The declaration and issuance of a common stock dividend reallocates part of the company's retained earnings to common stock, but it does not change the total assets, liabilities, or owners' equity of the company. It's essentially moving amounts within equity.

The Declaration and Issuance of a Common Stock Dividend