On June 30,2018,Ginger,Inc On July 1,2018,the Company Declared and Distributed a 9% Stock

question 96

Multiple Choice

On June 30,2018,Ginger,Inc.showed the following data on the equity section of their balance sheet: $$\begin{array} { | l | r | } \hline \text { Stockholders' Equity } & \\\hline \text { Common Stock, } \$ 1 \text { par; 202,000 shares authorized, } & \\150,000 \text { shares issued and outstanding } & \$ 150,000 \\\hline \text { Paid-In Capital in Excess of Par-Common } & \$ 260,000 \\\hline \text { Retained Earnings } & \$ 946,000 \\\hline \text { Total Stockholder's Equity } & \$ 1,356,000 \\\hline\end{array}$$ On July 1,2018,the company declared and distributed a 9% stock dividend.The market value of the stock at that time was $20 per share.Following this transaction,what is the balance of Common Stock?

• A) $163,500
• B) $57,180
• C) $285,540
• D) $357,180

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Definitions:

Overhaul Costs

The expenses associated with a comprehensive inspection, maintenance, and repair of equipment, machinery, or systems to ensure their operational efficiency.

Salvage Value

The estimated residual value of an asset at the end of its useful life.

Incremental Cost Approach

The incremental cost approach involves evaluating the additional costs and benefits associated with making one decision over another, used to make economically sound choices.

Payback Period

The length of time required for an investment to recover its initial cost out of the cash receipts that it generates.