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Dora Company declared and distributed a 10% stock dividend on 30,000 shares of issued and...

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Accounting

Dora Company declared and distributed a 10% stock dividend on 30,000 shares of issued and outstanding $5 par value common stock. The market price per share was $19 on the declaration date and was $20 on the distribution date. Which of the following correctly describes the accounting for the declaration and distribution of the stock dividend?

Capital in excess of par increased $45,000.

Retained earnings decreased $57,000.

Common stock increased $57,000.

Retained earnings decreased $60,000.

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