Duke Corporation Reports the Following Components of Stockholders' Equity on December

question 194

Multiple Choice

Duke Corporation reports the following components of stockholders' equity on December 31,2013:
$\begin{array}{lr}\text { Common stock }-\$ 25 \text { par value, } 95,000 \text { shares authorized, } 45,000 \text { shares }\\\text { issued and outstanding } & \$ 1,125,000 \\ \text { Paid-in capital in excess of par value, common stock } &60,000 \\\text { Retained earnings } &460,000 \\ \text { Total stockholders' equity } & \$ 1,645,000\end{array}$

$\text { In 2014, the following transactions affected its stockholders equity accounts: }$

Jan. 1 Purchased 4,500 shares of its own stock at $\$ 27$ cash per share.
Jan. 5 Directors declared a $\$ 3$ per share cash dividend payable on Feb. 28 to the Feb. stockholders of record.

Feb. 28 Paid the dividend declared on January 5 .
Mar. 3 Sold 1,000 shares of treasury stock for $\$ 28$ per share
Mav 25 Sold 1,000 shares of treasulu stock for $\$ 16$ per share.
What is the amount in the Retained Earnings account immediately after the May 25 sale?

• A) $460,000
• B) $328,500
• C) $444,000
• D) $433,000
• E) $338,500

---

Definitions:

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return, considering the time value of money.

Individual Retirement Account

A tax-advantaged investing tool that individuals use to earmark funds for retirement savings.

Rate of Return

The profit or deficit generated from an investment during a defined timeframe, represented as a percentage of the investment's initial value.

Insurance Settlement

An insurance settlement is the payment made by an insurance company to a claimant, policyholder, or a designated recipient as compensation for a covered loss or policy event.