11Which of the following will happen to a stockholder's percentage ownership in the stock of a corporation when the corporation declares a stock dividend?
A) The stockholder's percentage ownership decreases.
B) The stockholder's percentage ownership can increase or decrease.
C) The stockholder's percentage ownership increases.
D) The stockholder's percentage ownership stays the same.
12Which of the following occurs when a corporation distributes a stock dividend?
A) Total liabilities increase.
B) Stockholders' equity increases.
C) Total assets decrease.
D) Stockholders' equity remains unchanged.
13Which of the following occurs when a corporation's board of directors distributes a 10% stock dividend?
A) Retained earnings will be credited for the new shares times the current market value of the stock.
B) Retained earnings will be debited for the new shares times the current market value of the stock.
C) Retained earnings will be debited for the new shares times the par value of the stock.
D) Retained earnings will be credited for the new shares times the par value of the stock.
14The entry to record a stock dividend depends on its size. Which of the followingpercentages is the upper limit for a stock dividend to be classified as a small stock dividend?
A) 20%
B) 10%
C) 15%
D) 25%
15Stock dividends are declared by the:
A) chief financial officer of the company.
B) board of directors of the company.
C) chief executive officer of the company.
D) stockholders of the company.
16A company originally issued 10,000 shares of $5 par value common stock at $7 per share. The board of directors declares a 10% stock dividend when the market price of the stock is $9 a share. Which of the following is included in the entry to record the stock dividend?
A) Retained earnings is debited for $9,000.
B) Retained earnings is credited for $9,000.
C) Retained earnings is debited for $5,000.
D) Common stock is credited for $9,000.
17A company originally issued 10,000 shares of $5 par value common stock at $9 per share. The board of directors declares an 8% stock dividend when the market price of the stock is $10 a share. Which of the following is included in the entry to record the stock dividend?
A) Retained earnings is debited for $4,000.
B) Common stock is credited for $7,200.
C) Common stock is credited for $8,000.
D) Retained earnings is debited for $8,000.
18A corporation reported the following equity section on its current balance sheet. The common stock is currently selling for $12.00 per share.
Common stock, $5 par, 100,000 shares authorized,
50,000 shares issued
|
$250,000
|
Paid in capital in excess of par–common
|
150,000
|
Retained earnings
|
300,000
|
Total stockholders' equity
|
$700,000
|
Which of the following would be included in the entry to record a 10% stock dividend?
A) Common stock would be credited for $25,000.
B) Common stock would be debited for $25,000.
C) Paid-in capital in excess of par–common is debited for $35,000.
D) Retained earnings would be credited for $60,000.
19Gordon Corporation reported the following equity section on its current balance sheet. The common stock is currently selling for $11.50 per share.
Common stock, $5 par, 100,000 shares authorized, 40,000 shares issued
|
$200,000
|
Paid in capital in excess of par–common
|
120,000
|
Retained earnings
|
290,000
|
Total stockholders' equity
|
$610,000
|
What would be the Total stockholders' equity after a 10% common stock dividend?
A) $656,000
B) $320,000
C) $610,000
D) $366,000
20Gordon Corporation reported the following equity section on its current balance sheet. The common stock is currently selling for $11.50 per share.
Common stock, $5 par, 100,000 shares authorized, 40,000 shares issued
|
$200,000
|
Paid in capital in excess of par–common
|
120,000
|
Retained earnings
|
290,000
|
Total stockholders' equity
|
$610,000
|
What would be the balance in the Common stock account after the issuance of a 10% stock dividend?
A) $200,000
B) $246,000
C) $220,000
D) $226,000