Question

Encore Industries owned investment securities with a book value of $45 million on August 12. At that time, Encore’s board of directors declared a property dividend consisting of these securities. The fair value of the securities was as follows: Declaration – August 12 $ 58 million Record date – September 1 62 million Distribution date – September 20 60 million What amount of gain should Encore recognize in earnings in connection with this property dividend?

Answer 1

$180 million

Step-by-step explanation:

$45 million

and $58 million + $62 million + $60 million = $ $180 million

Encore´s earnings should be $135 million