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Viktor [21]
3 years ago
6

What is the effect of declaring a stock dividend on the liabilities and stockholders' equity section of the balance sheet? a.A d

ecrease in total liabilities and an increase in total stockholders' equity
Business
1 answer:
kati45 [8]3 years ago
8 0

Answer:

An increase in total liabilities and a decrease  in stockholders' equity

Explanation:

When a dividend is declared but not ye paid, it is credited as current liability because it has increased the company liability while retained earnings is being Debited because of the profit distribution.

When it is eventually paid, cash account is credited while dividend liability account is  debited.

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Difference between Private and public Company company
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What is the main difference between ballon mortgage and arm
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3 years ago
Read 2 more answers
"The common stock of One Community Bank is currently selling for $30. The last annual dividend paid was $1.25 per share and the
Greeley [361]

Answer:

The dividend growth rate is 8%.

Explanation:

Considering the stock is the one that has a constant dividend growth, we use the DDM approach for constant growth model. The constant growth model formula for price of a stock today is,

P0 = D1 / r - g

Where,

  • D1 is the dividend in the next period or D0 * (1 + g)
  • r is the required rate of return
  • g is the growth rate in dividends

Plugging in the available value,

30 = 1.25 ( 1+g) / (0.125 - g)

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4 0
3 years ago
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