Multiple Choice
Ludwick Inc. has retained earnings of $800,000 and total equity of $2,000,000. It has 200,000 ordinary shares with a $5 par value outstanding, which is currently selling for $30 per share. If Ludwick declares a 15% share dividend on its ordinary shares
A) net income will decrease by $150,000.
B) retained earnings will decrease by $150,000 and total equity will increase by $150,000.
C) retained earnings will decrease by $900,000 and total equity will increase by $900,000.
D) retained earnings will decrease by $900,000 and share capital and share premium will increase by $900,000.
Correct Answer:
Verified
Correct Answer:
Verified
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