Lewis Industries owns 600,000 shares of Compton Corporation, which it originally purchased for $8 each. On December 1, 2020, Lewis declares it will distribute these shares to its stockholders as a dividend with a December 31 date of payment. The shares have a market price of $7 on the declaration date and $9 on the distribution date. If Lewis' carrying value for the shares is $5, how much of a reduction in stockholders' equity should it record as a result of this distribution? O $4,800,000 O $3,000,000 O $2,400,000 O $5,400,000 ما
Lewis Industries owns 600,000 shares of Compton Corporation, which it originally purchased for $8 each. On December 1, 2020, Lewis declares it will distribute these shares to its stockholders as a dividend with a December 31 date of payment. The shares have a market price of $7 on the declaration date and $9 on the distribution date. If Lewis' carrying value for the shares is $5, how much of a reduction in stockholders' equity should it record as a result of this distribution? O $4,800,000 O $3,000,000 O $2,400,000 O $5,400,000 ما
Chapter9: Acquisitions Of Property
Section: Chapter Questions
Problem 81IIP
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Question
Lewis Industries owns 600,000 shares of Compton Corporation, which it originally purchased for $8 each. On December 1,2020 , Lewis declares it will distribute these shares to its stockholders as a dividend with a December 31 date of payment. The shares have a market price of $7 on the declaration date and $9 on the distribution date. If Lewis' carrying value for the shares is $5, how much of a reduction in
Transcribed Image Text:Lewis Industries owns 600,000 shares of Compton Corporation, which it originally purchased for $8 each. On December 1, 2020,
Lewis declares it will distribute these shares to its stockholders as a dividend with a December 31 date of payment. The shares have a
market price of $7 on the declaration date and $9 on the distribution date. If Lewis' carrying value for the shares is $5, how much of a
reduction in stockholders' equity should it record as a result of this distribution?
O $4,800,000
O $3,000,000
O $2,400,000
O $5,400,000
ما
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