Instead of the usual cash dividend, Evie Corp. declared and distributed a property dividend from its overstocked merchandise. The excess of the merchandise's carrying amount over its market value should be:

A$.$ Ignored.

B$.$ Reported as a separately disclosed reduction of retained earnings.

C$.$ Reported as a separate item on the income statement, net of income taxes.

D$.$ Reported as a reduction in income before income from continuing operations.