Pierson Corporation owned 10,000 shares of Hunter Corporation. These shares were purchased in 2011 for $90,000. On November 15, 2015, Pierson declared a property dividend of one share of Hunter for every ten shares of Pierson held by a stockholder. On that date, price of Hunter was $28 per share, there were 90,000 shares of Pierson outstanding. What gain and net reduction in retained earnings would result from this property dividend? when the market Gain = SWER Net reduction in R/E= 28=252
Pierson Corporation owned 10,000 shares of Hunter Corporation. These shares were purchased in 2011 for $90,000. On November 15, 2015, Pierson declared a property dividend of one share of Hunter for every ten shares of Pierson held by a stockholder. On that date, price of Hunter was $28 per share, there were 90,000 shares of Pierson outstanding. What gain and net reduction in retained earnings would result from this property dividend? when the market Gain = SWER Net reduction in R/E= 28=252
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Pierson Corporation owned 10,000 shares of Hunter Corporation. These shares were purchased
in 2011 for $90,000. On November 15, 2015, Pierson declared a property dividend of one share
of Hunter for every ten shares of Pierson held by a stockholder. On that date, when the market
price of Hunter was $28 per share, there were 90,000 shares of Pierson outstanding. What gain
and net reduction in retained earnings would result from this property dividend?
Gain =
SWER
Net reduction in R/E=
90,000+ 10x128= 9000 x 28 = 252
of $10 par value common stock outstand
the market price of the st
A
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