On January 1, Lang, Inc. has 100,000 shares of stock issued and outstanding. The board of directors of Lang wants to authorize a large stock dividend. This means that they must aut... On January 1, Lang, Inc. has 100,000 shares of stock issued and outstanding. The board of directors of Lang wants to authorize a large stock dividend. This means that they must authorize a stock dividend of at least ________ shares of stock.
Understand the Problem
The question is asking how many shares of stock must be authorized for a stock dividend, based on the number of shares already issued and outstanding by Lang, Inc.
Answer
25,001 shares
The board must authorize a stock dividend of at least 25,001 shares.
Answer for screen readers
The board must authorize a stock dividend of at least 25,001 shares.
More Information
A large stock dividend is defined as one that exceeds 25% of the current outstanding shares. Thus, with 100,000 shares outstanding, adding at least 25,001 shares constitutes a large stock dividend.
Tips
A common mistake is misunderstanding the percentage threshold for a large stock dividend.
Sources
- On January 1, Lang Inc. Has 100,000 Shares Of Stock Issued And ... - old.hartland.edu
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