The declaration of a cash dividend will have no effect on book value per share.

A stock dividend of 15% of the outstanding common shares results in a debit to retained earnings at the par value of the stock distributed.

The declaration and payment of a 10% stock dividend will result in a reduction of retained earnings at the fair market value of the stock.

At the declaration date of a 30% stock dividend, the carrying value of retained earnings will be reduced by the fair market value of the stock distributed.

Each item (net of tax) is presented on the face of the income statement separately as a component of net income for the period.

Each item is presented as an unusual item within income from continuing operations.

Each item is presented exclusive of any related income tax.

All extraordinary gains or losses that occur in a period are summarized as total gains and total losses, then offset to present the net extraordinary gain or loss.

Competing businesses.

Stockbrokers.

Managers in charge of operating activities.

Bankers preparing to lend money.

Shareholders’ equity.

A liability.

An asset.

An expense.

Losses are expenses that may or may not arise in the course of ordinary activities.

Losses are material items, whereas expenses are immaterial items.

Losses are extraordinary charges to income, whereas expenses are ordinary charges to income.

Expenses can always be prevented, whereas losses can never be prevented.

Proprietary point of view.

Entity point of view.

Fund theory.

Enterprise theory.

Revenues.

Expenses.

Gains and losses.

Shareholders’ equity.

$2,800,000

$1,300,000

$(1,500,000)

$1,220,000

$700,000 and $3,900,000.

$900,000 and $3,900,000.

$700,000 and $3,600,000.

$900,000 and $3,600,000.

Financing activities.

Investing activities.

Operating activities.

Equity activities.

Investing activity.

Financing activity.

Operating activity.

Noncash investing and financing activity.

$521,405

$504,285

$405,205

$202,500

Proceeds from the issuance of common stock.

Decrease in income taxes payable.

Amortization expense

Decrease in inventories.

A decrease in accounts payable during the year.

The payment of cash for the purchase of additional equipment needed for current production.

The payment of a cash dividend from money arising from current operations.

An increase in cash resulting from the issuance of previously authorized common stock.

Single-step method.

Indirect method.

Direct method.

Multiple-step method.