Falcon Corporation Has $200,000 of Current E & P and a Deficit

question 10

Multiple Choice

Falcon Corporation has $200,000 of current E & P and a deficit in accumulated E & P of $90,000. If Swan pays a $300,000 distribution to its shareholders on July 1, how much dividend income do the shareholders report?

• A) $0.
• B) $10,000.
• C) $110,000.
• D) $200,000.
• E) None of the above.

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Definitions:

Negative Message

A communication that conveys bad news, rejection, or unfavorable information to the recipient.

Detail

An individual feature, fact, or item, especially one that is considered to be intricate or significant.

Positive Message

Communication that conveys good news or a favorable outcome, often intended to motivate or affirm.

Informative Message

A communication that provides data, facts, updates, or feedback without an explicit intention to persuade.