The book value per share of common stock of Lawrence Company is $10. The company declares and issues a small stock dividend when the market price per share is $7. How would this transaction affect book value per share?  Book value per share = Total stockholders' equity/Number of common shares outstanding Select one: a. Cannot be determined from the information provided  b. Increase book value per share c. No effect on book value per share d. Decrease book value per share

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Stockholder's Equity

The stockholders’ equity (often referred to as the book value of the company) is the number of assets available to the stockholder after its entire liabilities is paid off. The stockholders’ equity is also sometimes referred to as owner's equity. The stockholders’ equity or book value generally includes common stock, treasury stock retained earnings. It is an indicator of a company's financial strength and is an important item on the company's balance sheet.