Use the Following Information for Questions 68 and 69

Multiple Choice

Use the following information for questions 68 and 69.
The balance in retained earnings at December 31, 2014 was $1,080,000 and at December 31, 2015 was $873,000. Net income for 2015 was $750,000. A stock dividend was declared and distributed which increased common stock $375,000 and paid-in capital $165,000. A cash dividend was declared and paid.
-The stock dividend should be reported on the statement of cash flows (indirect method) as

A) an outflow from financing activities of $375,000.
B) an outflow from financing activities of $540,000.
C) an outflow from investing activities of $540,000.
D) Stock dividends are not shown on a statement of cash flows.