Mr. Gibson Corporation owned 20,000 shares of Old Towne Corp…

Questions

Mr. Gibsоn Cоrpоrаtion owned 20,000 shаres of Old Towne Corporаtion's $5 par value common stock. These shares were purchased in 2025 for $225,000. On September 15, 2029, Mr. Gibson declared a property dividend of one share of Old Towne for every ten shares of Mr. Gibson held by a stockholder. On that date, when the market price of Old Towne was $35 per share, there were 180,000 shares of Mr. Gibson outstanding. What NET reduction in retained earnings would result from this property dividend?