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If you received a true stock dividend, ie You own 100 shares and receive new shares equal to say 10% of your holdings, the usual routine is to adjust the cost basis of your shares. So price per share become your cost divided by 110. Your cost does not change, but now you own more shares.

If however, you mean mutual fund dividends that were reinvested in new shares, then you want to record the cost and number of shares of each purchase. Hence, your average share price changes every time, but usually for tax purposes, each transaction is treated separately.
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