Answer:
B) did not change.
Explanation:
Stock dividend is the payment of dividend to stockholder in the form of stock/shares of the company. Stock are issued at the market price and the value of the dividend is transferred from the retained earning to the add-in-capital accounts.
Dividend Value = 200,000 x 10% x 25 = $500,000
Par Value of Stocks = $1 x 20,000 = $20,000
Add-in-capital excess of par common stock = ($25-$1) x 20,000 = $480,000
Following entry will be recorded
Dr. Retained earning $500,000
Cr. Common Stock $20,000
Cr. Add-in-capital excess of par common stock $480,000
As all of the accounts are equity accounts and decrease in one equity account and increase in another equity account will not change the total stockholders equity value.
Depends honestly but generally 20 min
