Stinson Corporation owned 30,000 shares of Matile Corporation. These shares were purchased in 2011 for $270,000. On November 15, 2015, Stinson declared a property dividend of one share of Matile for every ten shares of Stinson held by a stockholder. On that date, when the market price of Matile was $25 per share, there were 270,000 shares of Stinson outstanding. What gain and net reduction in retained earnings would result from this property dividend? Gain Net Reduction in Retained Earnings $0 $108,000 $513,000 $756,000 $432,000 $243,000 $432,000 $675,000
Stinson Corporation owned 30,000 shares of Matile Corporation. These shares were purchased in 2011 for $270,000. On November 15, 2015, Stinson declared a property dividend of one share of Matile for every ten shares of Stinson held by a stockholder. On that date, when the market price of Matile was $25 per share, there were 270,000 shares of Stinson outstanding. What gain and net reduction in retained earnings would result from this property dividend? Gain Net Reduction in Retained Earnings $0 $108,000 $513,000 $756,000 $432,000 $243,000 $432,000 $675,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Stinson Corporation owned 30,000 shares of Matile Corporation. These shares were purchased in 2011 for $270,000. On November 15, 2015, Stinson declared a property dividend of one share of Matile for every ten shares of Stinson held by a stockholder. On that date, when the market price of Matile was $25 per share, there were 270,000 shares of Stinson outstanding. What gain and net reduction in
Gain Net Reduction in
Retained Earnings
- $0 $108,000
- $513,000 $756,000
- $432,000 $243,000
- $432,000 $675,000
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