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Princeton Corp. wants to throw something to its shareholders this year, but is cash poor....

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Accounting

Princeton Corp. wants to throw something to its shareholders this year, but is cash poor. The board decides on a two-for-one stock dividend: common on common. The shareholders of record at the time of the dividend

a.

have the value of their holdings doubled, taxation on which is postponed until the shares are sold.
b.

double their shares, allocating the pre-split basis in the stock equally among the shares.
c.

realize a taxable dividend equal in amount to the value of their pre-split shares.

d.

have nontaxable return of all their capital.

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