Boxer Company Owned 20,000 Shares of King Company That Were

question 82

Multiple Choice

Boxer Company owned 20,000 shares of King Company that were purchased in 2016 for $500,000. On May 1, 2018, Boxer declared a property dividend of 1 share of King for every 10 shares of Boxer stock. On that date, there were 50,000 shares of Boxer stock outstanding. The market value of the King stock was $30 per share on the date of declaration and $32 per share on the date of distribution. By how much is retained earnings reduced by the property dividend?

• A) $0.
• B) $150,000.
• C) $160,000.
• D) $300,000.

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Definitions:

British North America

Territories in North America under British rule before the formation of the United States and Canada, encompassing colonies that later became part of these and other countries.

Glorious Revolution

The overthrow of King James II of England in 1688 by a union of Parliamentarians with the Dutch stadtholder William III, marking the transition towards constitutional monarchy.

Massachusetts Colony

One of the original English settlements in North America, established in 1620 by the Puritans, it played a central role in the early history of what became the United States.

Toleration Act

Was legislation passed in England in 1689 that granted freedom of worship to Nonconformists, although with several restrictions, marking a step toward religious freedom.