XY Company Had the Following Shareholder Equity: Common Shares Outstanding

question 54

Multiple Choice

XY Company had the following shareholder equity: Common shares outstanding, 10,000; average issue price, $115; current market price, $140.Shares sold on a stock subscription basis are not issued until the subscription price is collected in full.Recording a declaration of a 10 percent stock dividend in conformity with generally accepted accounting principles would change retained earnings:

• A)On the basis of an arbitrary value of shares.
• B)By 10 percent of its balance before the dividend.
• C)On the basis of the market value of shares.
• D)On the basis of the average paid-in value of shares.

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Definitions:

Intellectual Capital

The intangible value of a business, covering its people (human capital), the value relating to its relationships (relational capital), and everything that is left when the workers go home (structural capital), which includes the proprietary knowledge.

Collective Brainpower

The combined intelligence, creativity, and problem-solving abilities of a group or team.

Workforce

The collective group of employees working in an organization or sector, encompassing various roles, skills, and backgrounds.

Knowledge Workers

Employees whose primary job involves processing and making decisions based on information, such as programmers, engineers, and scientists.