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.

Question

Quizplus · Accepted Answer

The amount of the dividend is based on the market value of the property on the declaration date. Therefore, the dividend is 20,000 shares x $10 per share = $200,000.

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