A Company Has 3,000 Shares of $2 Par Value Common

question 72

Multiple Choice

A company has 3,000 shares of $2 par value common stock and 1,500 shares of 8%,$150 par,noncumulative preferred stock outstanding.The balance in Retained Earnings at the beginning of the year was $400,000.The net loss for the current year was $30,000.If the company paid a dividend of $1 per share on its common stock,what is the balance in Retained Earnings at the end of the year?

• A)$349,000
• B)$365,800
• C)$451,000
• D)$400,000
• E)$409,000

---

Definitions:

Reflex

An involuntary response, one that is not under personal control or choice.

Newborn

Refers to a baby from birth to about 2 months of age, characterized by rapid physical growth and developmental changes.

Spontaneous Abortion

A medical term often used to describe a miscarriage, which is the natural loss of a fetus before it is viable outside the womb.

Miscarriage

The spontaneous loss of a pregnancy before the fetus can survive independently, often occurring before the 20th week of gestation.