Question

Atkins Company had 20,600 shares of $5 par value common stock outstanding prior to declaring a 10% common stock dividend. The market value of the common stock on the declaration date was $11 Which of the following statements correctly describes the effect of the common stock dividend?Which of the following statements correctly describes the effect of the common stock dividend?b. Total stockholders' equity decreased by $10,300.c. Total stockholders' equity decreased by $22,660.d. Retained earnings decreased by $22,660.

Answer 1

C. The total stockholder's equity decreased by $22,660

D. and the retained earnings will also decrease by $22,660.

Step-by-step explanation:

the total common stock dividend is $22660, and, in this situation, The total stockholder's equity decreased by $22,660, and the retained earnings will also decrease by $22,660.