Final answer:
After declaring and distributing a 25% stock dividend, Vision Inc, which originally had 400,000 common shares, would have a total of 500,000 shares issued and outstanding.
Step-by-step explanation:
If Vision Inc had 400,000 common shares when a 25% stock dividend was declared and distributed, we need to calculate the new number of shares issued and outstanding after the stock dividend. A 25% stock dividend means that for every 100 shares owned, an additional 25 shares are distributed to shareholders.
To find out how many new shares are issued, multiply the original number of shares by the percentage of the stock dividend:
400,000 shares × 0.25 = 100,000 new shares.
After the stock dividend, the total number of shares outstanding would be the original amount plus the new shares distributed:
400,000 shares + 100,000 shares = 500,000 shares.
Therefore, after a 25% stock dividend, Vision Inc would have 500,000 shares issued and outstanding.