12. The declaration of a cash dividend by the directors results inc A a decrease
ID: 2600810 • Letter: 1
Question
12. The declaration of a cash dividend by the directors results inc A a decrease in cash and a decrease in retained earnings. B. a decrease in retained earnings and an increase in current liablities C. a decrease in net income and a decrease in cash. D. a decrease in net income and an increase in current liabilities. Spike Jones owns 56 shares of the Robust Corporation's stock. Robust announces a How many shares will Fred have after this spit? 3-for-2 stock split 13. the as of the A 178 shares. B. 112 shares C. 84 shares. D. 56 shares. n the intere ine balance of 14. When a stock dividend is declared and issued: eived re printed mailed t e sold to A total paid-in capital does not change. B. total stockholders' equity does not change. C. retained earnings is normally decreased by the par value of the shares issued in the dividend. D. total paid-in capital is decreased by the market value of the shares issued in the dividend. accrue l 15. Gains differ from revenues because gains: A. are not a result of the entity's ongoing, central operations. B. do not have to be realized. C. are reported as income from operating activities. D. do not involve any offsetting costs or expenses.Explanation / Answer
Question:12
Answer is Option (B) a decrease in retained earnings & increase in current liabilities.
Because, declaration of dividend is a debit to retained earnings to it get decreases and it is a credit to dividend payable hence it increases the current liabilities.
Question (13)
Solution: The no. of shares that Fred will have after stock split = 56×3/2 = 84 shares.
Thus, answer is Option C.
Question: (14)
Answer : Option (B) Total stockholders' equity does not change. Because stock dividend is issued from the available retained earnings which are part of current stockholders' equity.
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