Supervox Corporation declared a 3-for-2 ordinary share split, but this transaction was erroneously recorded as a 50% ordinary share dividend. As a result:

Question

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The erroneous recording of a 3-for-2 share split as a 50% share dividend would reduce retained earnings, as dividends are paid out of retained earnings, leading to an understatement of retained earnings.

Supervox Corporation Declared a 3-For-2 Ordinary Share Split, but This