A stock dividend is paid in shares of newly-issued stock, not in cash. A stock dividend increases the number of common shares outstanding but does not increase common equity on the balance sheet. Since a stock dividend is not paid in cash, it cannot affect the current ratio.
A stock dividend is paid in shares of newly-issued stock, not in cash. A stock dividend increases the number of common shares outstanding but does not increase common equity on the balance sheet. Payment of a stock dividend does not affect operating assets on the balance sheet, and it does not affect net income. Therefore, it could not affect return on operating assets.
A stock dividend is paid in shares of newly-issued stock, not in cash. A stock dividend increases the number of common shares outstanding but does not increase common equity on the balance sheet. The book value per share is total assets minus all liabilities and claims of securities that are senior to the common stock (i.e., take priority over common stockholders' claims) such as preferred stock, divided by the number of common shares outstanding. When the divisor, the number of common shares, increases, the book value per common share will decrease.
A stock dividend is paid in shares of newly-issued stock, not in cash. A stock dividend increases the number of common shares outstanding but does not increase common equity on the balance sheet. Since equity does not change, the debt-to-equity ratio will not change.
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