Answered: The entry to record the declaration of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Farmer Corp. owned 20,000 shares of Eaton Corp. purchased in 2019 for P300,000. On December 15, 2020, Farmer declared a property dividend of all of its Eaton Corp. shares on the basis of one share of Eaton for every 10 shares of Farmer ordinary shares held by its stockholders. The property dividend was distributed on January 15, 2021. On the declaration date, the aggregate market price of the Eaton shares held by Farmer was P500,000. The entry to record the declaration of the dividend would include a debit to Retained Earnings of

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