FAR – Stock Dividends – Cost and Equity methods

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  • November 25, 2015 at 7:47 am #198548
    roadtocpa
    Member

    Hi everyone, I have a question regarding stock dividends. For the cost and equity methods, Becker says clearly on what to do with cash dividends. ．

    However for stock dividends, i am a little confused. If I am correct , stock dividends have no effect on the I/S for both cost and equity methods?

    For the B/ S – How do stock dividends effect the B/S for the cost and equity methods?

    Thank you so much !

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  • November 25, 2015 at 4:45 pm #745014
    shsubearkat
    Participant

    It's a reduction to retained earnings and a increase to the stock accounts…essentially it just re-balances the equity

    FAR 80
    AUD 79
    BEC 7/31

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