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25 February, 05:23

Plack Co. purchased 10,000 shares (2o/o ownership) of Ty Corp. on February 14, Year 1. Plack received astock dividend of 2,000 shares on April 30, Year 1, when the market value per share was $35. Ty paid a cash dividend of $2 per share on December 15, Year 1. In its Year 1 income statement, what amount should Plack report as dividend income? a. $20,000b. $24,000c. $90,000d. $94,000

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  1. 25 February, 05:30
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    d. $94,000

    Explanation:

    April 30th:

    2,000 shares x $35 per share = 70,000 sotck dividends

    December 15th:

    12,000 shares x $ 2 per share = 24,000 cash dividends

    total 94,000

    The dividend income will be for 94,000 the sum of both proceeds fom Ty Corp

    Plack will declare income for both, the stock received and the cash dividends.
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