ACC 304 help A Guide to career/Snaptutorial ACC 304 help A Guide to career/Snaptutorial | Page 163

14. The SEC requires companies to disclose their dividend policy
in their annual report.
15. All dividends, except for liquidating dividends, reduce the
total stockholders’ equity of a corporation
16. Dividends payable in assets of the corporation other than cash
are called property dividends or dividends in kind.
17. When a stock dividend is less than 20-25 percent of the
common stock outstanding, a company is required to transfer the fair
value of the stock issued from retained earnings.
18. Stock splits and large stock dividends have the same effect on
a company’s retained earnings and total stockholders’ equity.
19. The rate of return on common stock equity is computed by
dividing net income by the average common stockholders’ equity.
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