Market value of the common stock


Rick Co. had 30 million shares of $1 par common stock outstanding at January 1, 2009. In October, 2009, Rick Co.'s Board of Directors declared and distributed a 1% common stock dividend when the market value of its common stock was $60 per share. In recording this transaction, Rick would:

A. Debit retained earnings for $18 million

B. Credit paid-in capital - excess of par for $18 million

C. Credit common stock for $18 million

D. None of these is correct.

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Accounting Basics: Market value of the common stock
Reference No:- TGS091159

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