The company with the common equity accounts shown here has declared a stock dividend of 15 percent

Question:

The company with the common equity accounts shown here has declared a stock of 15 percent when the market value of its stock is $45 per share. What effects on the equity accounts will the of the stock have?
Common stock ($1 par value) ......... $ 410,000
Capital surplus .............. 2,150,000
Retained earnings .............. 5,320,000
Total owners’ equity ............. $7,880,000

Distribution
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A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...