Which of the following statements about property dividends is FALSE?
A) A property dividend is a nonreciprocal transfer of nonmonetary assets.
B) A property dividend is also called a dividend in kind.
C) The accounting for a property dividend should be based on the carrying value (book value) of the nonmonetary assets transferred.
D) The accounting for a property dividend should be based on the fair value of the nonmonetary assets transferred.

Question

Quizplus · Accepted Answer

The accounting for a property dividend should be based on the fair value of the nonmonetary assets transferred, not their carrying value (book value). This ensures that the financial statements reflect the most accurate and current valuation of the assets involved in the dividend distribution.

Which of the Following Statements About Property Dividends Is FALSE