Which of the following occurs when a corporation distributes a stock dividend?
A) Total liabilities would increase.
B) Total stockholders' equity would increase.
C) Total assets would decrease.
D) Total stockholders' equity would be unchanged.

Question

Quizplus · Accepted Answer

When a corporation distributes a stock dividend, it is essentially reallocating part of its retained earnings to common stock. This does not change the total amount of stockholders' equity; it just changes the composition within equity. Total assets and total liabilities remain unchanged.

Which of the Following Occurs When a Corporation Distributes a Stock