Detailed Answer
Answer (D) is correct.
The issuance of a stock dividend results in a debit to retained earnings and credits to contributed capital for the fair value of the stock. A split-up effected in the form of a dividend requires capitalization of retained earnings equal to the amount established by the issuer’s state of incorporation (usually par value). Consequently, neither a stock dividend nor a split-up effected in the form of a dividend has a net effect on equity.