Ducheyne Electric Recently Declared a 15 Percent Stock Dividend

question 52

Multiple Choice

Ducheyne Electric recently declared a 15 percent stock dividend.On the date of the stock dividend Ducheyne had 16 million shares outstanding priced at $46 per share in the market.An accounting entry was required on the balance sheet transferring some retained earnings to the common stock account.If retained earnings were $280 million prior to the transaction,what was the dollar amount of retained earnings after the transfer?

• A) $280.0 million
• B) $110.4 million
• C) $234.0 million
• D) $277.6 million
• E) $169.6 million

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Definitions:

Exclusive Possession

A legal term referring to the right of a party to use and control property to the exclusion of others.

Lease Termination

The ending of a lease agreement either by mutual agreement, expiration of the lease term, or other means as specified in the contract or by law.

Rental Period

The agreed upon duration between a landlord and tenant during which the tenant has the right to use and occupy the rental property.

Mortgage

A means of securing loans; title of property is held by the moneylender as security in some jurisdictions; in other jurisdictions, a mortgage is simply a charge against title.