There is no difference on an economic basis between a stock dividend and a stock split.

Question

Quizplus · Accepted Answer

Both stock dividends and stock splits do not affect the overall value of the company or the shareholder's proportionate ownership in the company. In a stock dividend, the shareholder receives additional shares of the company's stock, while in a stock split, the existing shares are divided into a higher number of shares. Both actions increase the number of outstanding shares, but neither affects the company's earnings or assets. Therefore, there is no economic difference between the two.

There Is No Difference on an Economic Basis Between a Stock