Lucid Company Declared a Property Dividend of 20,000 Shares of $1

question 43

Multiple Choice

Lucid Company declared a property dividend of 20,000 shares of $1 par Polk Company common stock. The Polk stock was purchased for $5 per share. Market value was $10 per share on the declaration date and $11 per share on the distribution date. What is the amount of the dividend?

• A)$100,000.
• B)$200,000.
• C)$220,000.
• D)$300,000.20,000 $10 = $200,000

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Definitions:

Directly Related

A situation where two variables move in the same direction, meaning if one increases, the other also increases and vice versa.

Price Inelastic

Describes a situation where the demand for a good is not significantly affected by changes in its price.

Farm Incomes

The earnings generated from the operation of a farm, including profits from selling agricultural products.

Cross Elasticity

A metric showing how demand for a particular good is affected by changes in the pricing of another good.