A corporation declared a 40% share capital dividend on its 60,000 shares of P20 par ordinary shares on a day when the market price is P50. How much was debited to Retained Earnings on the date of declaration?

A corporation declared a 40% share capital dividend on its 60,000 shares of P20 par ordinary shares on a day when the market price is P50. How much was debited to Retained Earnings on the date of declaration?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 3RE

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Stockholder's Equity

The stockholders’ equity (often referred to as the book value of the company) is the number of assets available to the stockholder after its entire liabilities is paid off. The stockholders’ equity is also sometimes referred to as owner's equity. The stockholders’ equity or book value generally includes common stock, treasury stock retained earnings. It is an indicator of a company's financial strength and is an important item on the company's balance sheet.

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