On January 1, 2017, When the Market Value of Their

question 1

Multiple Choice

On January 1, 2017, when the market value of their common shares was $20 per share, Belgrade Inc.declared a 10% common stock dividend.Shareholders' equity before the stock dividend was declared was:
Common shares, no par value, authorized 200,000 shares,
What was the effect on Belgrade's retained earnings as a result of the stock dividend?

• A)$240,000 decrease
• B)$400,000 decrease
• C)$480,000 decrease
• D)$800,000 decrease

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Definitions:

Face Value

The nominal value printed on a financial instrument, such as a bond or a stock certificate.

Semiannual Interest

Interest on a loan or bond that is calculated and paid twice a year.

Face Value

The nominal or dollar value printed on a bond, note, or other financial instrument, representing the amount due at maturity.

Journal Entries

Are the record of all transactions a company makes, detailed by date, in the accounting system.