Assume a Firm Has Declared a 20% Stock Dividend on Its

question 136

Multiple Choice

Assume a firm has declared a 20% stock dividend on its 1 million shares of outstanding $5 par value common stock. If the market value of the stock at the date of the stock dividend is $14 per share and the retained earnings account balance before the stock dividend was $7,600,000, what is the retained earnings account balance after the stock dividend?

• A)$3,600,000
• B)$1,960,240
• C)$7,600,000
• D)$4,800,000

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Definitions:

Defective Diode

A defective diode is a faulty electronic component that fails to conduct electricity in only one direction as intended, potentially causing circuit malfunctions.

Voltage Regulator

A device within an electrical system that maintains the output voltage at a constant level despite changes in load or input voltage.

Field Current

The electric current that flows through the winding of a generator or motor, generating a magnetic field necessary for their operations.

Brushes

Stationary devices used to conduct current to or from a rotor in electrical components such as alternators and motors.