Which of the following actions will decrease the amount of Total Stockholders' Equity?
A) cash dividend declared
B) stock split
C) stock dividend declared
D) repayment of bond principal

Question

Quizplus · Accepted Answer

Cash dividends declared decrease the amount of Total Stockholders' Equity as it is a distribution of earnings and reduces the retained earnings in the equity section of the balance sheet. Stock split and stock dividends do not affect the total amount of equity, and repayment of bond principal reduces the liability side of the balance sheet, not the equity side.

Which of the Following Actions Will Decrease the Amount of Total