1. On December 31, 20X0, a company declared and distributed a property dividend at a time when the fair market value of the property was greater than the net book value of the property. As a result of the declaration and distribution of the dividend, what are the accounting effects of this transaction? (a) The property dividends are recorded at net book value and retained (b) (c) (d) earnings will decrease. The property dividends are recorded at fair market value and retained earnings will increase. The property dividends are recorded at net book value and retained earnings will increase. The property dividends are recorded at fair market value and retained earnings will decrease. 2. A corporation declared a dividend, part of which was considered a liquidating dividend. How does the declaration of such a dividend affect each of the following general ledger accounts? Additional Paid In Capital Retained Earnings No effect (b) Decrease (c) Decrease (d) No effect Decrease Decrease No effect No effect