1-MCQ

On December 31, 2018, BEE reported as follows:

Common Share Capital, 90,000 shares issues and outstanding $446,400

Contributed Surplus - Common Shares Repurchased $ 23,000

Retained Earnings $124,000

On March 1, 2019, bond holders converted 200 bonds with an amortized cost of $810 each, for 27,000 common shares. There was no contributed surplus - bond conversion. The market value of the shares on that day was $5.80 per share. On July 15, BEE declared a 20% stock dividend. The market price of each share was $5.50 ex-dividend. On October 1, the company acquired 17,000 common shares at a price of $7.10 and cancelled them. Net earnings were zero in 2019. On December 31, 2019, BEE would report the three accounts as follows:

Select one:

a. Common Share Capital, $616,400; Contributed Surplus - Common Shares Repurchased, $23,000; Retained Earnings, $124,000.

b. Common Share Capital, $616,400; Contributed Surplus - Common Shares Repurchased, $23,000; Retained Earnings, $3,300.

c. Common Share Capital, $642,450; Contributed Surplus - Common Shares Repurchased, $0; Retained Earnings, $110,150.

d. Common Share Capital, $647,850; Contributed Surplus - Common Shares Repurchased, $23,000; Retained Earnings, $87,150.

e. Common Share Capital, $647,850; Contributed Surplus - Common Shares Repurchased, $0; Retained Earnings, $115,550.