Question: Gordon Ltd directors declared a bonus issue for 100 000 shares to be issued at $1.50 each in August. Which of the following is not

Gordon Ltd directors declared a bonus issue for 100 000 shares to be issued at $1.50 each in August. Which of the following is not true about the bonus issue?

A It increases the net assets of the company by $150 000.

B Cash is unchanged by the bonus issue.

C Directors can use this opportunity to signal future dividend policy to current and future shareholders. D This makes the company's shares 'seem' more affordable, as on a per-share basis they are now cheaper.

E Total shareholders' equity balance remains unchanged from the bonus issue.

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