The Borio Company had an asset with an $8 book value and a $7 market value; it decided to distribute the asset as a property dividend. Journal entries were made to adjust the property to market value and declare the dividend. Indicate the combined effect on the Net Income and Retained Earnings, respectively:

Select one:

a.

Decrease, Decrease

b.

No Effect, Decrease

c.

No Effect, Increase

d.

Decrease, Increase

e.

Increase, Decrease