A Company with 100,000 Authorized Shares of $4 Par Common

Multiple Choice

A company with 100,000 authorized shares of $4 par common stock issued 40,000 shares at $8. Subsequently, the company declared a 4% stock dividend on a date when the market price was $12 a share. What is the amount transferred from the retained earnings account to paid-in capital accounts as a result of the stock dividend?

A) $12,800
B) $19,200
C) $32,000
D) $48,800