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A Company with 100,000 Authorized Shares of $4 Par Common

question 69

Multiple Choice

A company with 100,000 authorized shares of $4 par common stock issued 40,000 shares at $8. Subsequently, the company declared a 4% stock dividend on a date when the market price was $12 a share. What is the amount transferred from the retained earnings account to paid-in capital accounts as a result of the stock dividend?


Definitions:

Consensus

A decision-making process that seeks unanimity, general agreement, or at least the absence of active opposition among members of a group.

Pay Secrecy

Refers to the extent to which the compensation of any individual in an organization is secret or the extent to which information on compensation is formally made available to other individuals.

Pay Inversion

A phenomenon where newer employees receive higher compensation than their more experienced counterparts due to market rate changes, negotiation, or other factors.

Teamwork

The collaborative effort of a group to achieve a common goal or to complete a task in the most effective and efficient way.

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