Which of the following is true of a stock dividend?
A)It is a liability on the balance sheet.
B)The decision to declare a stock dividend resides with the shareholders.
C)Transfers a portion of equity from retained earnings to a cash reserve account.
D)Does not affect total equity,but transfer amounts between the components of equity.
E)Reduces a corporation's assets and stockholders' equity.

Question

Quizplus · Accepted Answer

A stock dividend does not affect total equity but reallocates amounts within equity, typically from retained earnings to paid-in capital.

Which of the Following Is True of a Stock Dividend