On October 31, the stockholders' equity section of Crane Company's bala earnings $402,000. Crane is considering the following two courses of action: (1) declaring a 5% stock dividend on the 92,000, $8 par value shares outstanding or (2) effecting a 2-for-1 stock split that will reduce par value to $4 per share. The current market price is $18 per share Prepare a tabular summary of the effects of the alternative actions on the company's stockholders' equity and outstanding shares Before Action After Stock Dividend Stockholders' equity Paid-in capital Retained earnings Total stockholders' equity 736.000 402,000 1.138,000 $ After Stock Split

On October 31, the stockholders' equity section of Crane Company's bala earnings $402,000. Crane is considering the following two courses of action: (1) declaring a 5% stock dividend on the 92,000, $8 par value shares outstanding or (2) effecting a 2-for-1 stock split that will reduce par value to $4 per share. The current market price is $18 per share Prepare a tabular summary of the effects of the alternative actions on the company's stockholders' equity and outstanding shares Before Action After Stock Dividend Stockholders' equity Paid-in capital Retained earnings Total stockholders' equity 736.000 402,000 1.138,000 $ After Stock Split

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 5P: Alert Companys shareholders equity prior to any of the following events is as follows: The company...

See similar textbooks

Similar questions

Assume that Lily Corporation has outstanding 1,500 shares of 150 par callable preferred stock that were issued at 175 per share, and that no dividends are in arrears. If the call price is 185 per share, what journal entry will Lily make to record the recall of these shares?
According to a company press release, on January 5, 2012, Hansen Natural Corporation changed its name to Monster Beverage Corporation. According to Yahoo Finance, on that day the value of the company stock (symbol: MNST) was $15.64 per share. On January 5, 2018, the stock closed at $63.49 per share. This represents an increase of nearly 306%. A. Discuss the factors that might influence the increase in share price. B. Consider yourself as a potential shareholder. What factors would you consider when deciding whether or not to purchase shares in Monster Beverage Corporation today?
Use the same facts as in RE 16-3, but instead assume that Pickens declares and issues a 50% stock dividend when the stock is selling for 30 per share. Prepare the journal entry on the date of declaration to record Pickenss stock dividend.
Outstanding Stock Lars Corporation shows the following information in the stockholders equity section of its balance sheet: The par value of common stock is S5, and the total balance in the Common Stock account is $225,000. There are 13,000 shares of treasury stock. Required: What is the number of shares outstanding? Use the following information for Exercises 10-58 and 10-59: Stahl Company was incorporated as a new business on January 1, 2019. The company is authorized to issue 600,000 shares of $2 par value common stock and 80,000 shares of 6%, S20 par value, cumulative preferred stock. On January 1, 2019, the company issued 75,000 shares of common stock for $15 per share and 5,000 shares of preferred stock for $25 per share. Net income for the year ended December 31, 2019, was $500,000.
Nutritious Pet Food Companys board of directors declares a 2-for-1 stock split on June 30 when the stocks market value per share is $30. At that time, there are 10,000 shares of $1 par value common stock outstanding (none held in treasury). What is the new par value of the shares and how many shares are outstanding after the split? What is the total amount of equity before and after the split?
Lyon Company shows the following condensed income statement information for the year ended December 31, 2019: Lyon declared dividends of 6,000 on preferred stock and 17,280 on common stock. At the beginning of 2019, 10,000 shares of common stock were outstanding. On May 1, 2019, the company issued 2,000 additional common shares, and on October 31, 2019, it issued a 20% stock dividend on its common stock. The preferred stock is not convertible. Required: 1. Compute the 2019 basic earnings per share. 2. Show the 2019 income statement disclosure of basic earnings per share. 3. Draft a related note to accompany the 2019 financial statements.
On October 31, the stockholders' equity section of Blossom Corporation's balance sheet consists of common stock $659,200 and retained earnings $877,000. Blossom is considering the following two courses of action: (1) declaring a 5% stock dividend on the 82.400 $8 par value shares outstanding or (2) effecting a 2-for-1 stock split that will reduce par value to $4 per share. The current market price is $15 per share. Prepare a tabular summary of the effects of the alternative actions on the company's stockholders' equity and outstanding shares. Stockholders' equity Paid-in capital Retained earnings Total stockholders equity $ Outstanding shares Before Action $ $ After Stock Dividend $ After Stock Split
On October 31, the stockholders’ equity section of Oriole Company’s balance sheet consists of common stock $833,000 and retained earnings $901,000. Oriole is considering the following two courses of action: (1) declaring a 6% stock dividend on the 83,300 $10 par value shares outstanding or (2) effecting a 2-for-1 stock split that will reduce par value to $5 per share. The current market price is $15 per share. Prepare a tabular summary of the effects of the alternative actions on the company’s stockholders’ equity and outstanding shares.
On October 31, the stockholders' equity section of Cullumber Company consists of common stock $315,000 and retained earnings $893,000. Cullumber is considering the following two courses of action: (1) declaring a 6% stock dividend on the 31,500, $10 par value shares outstanding, or (2) effecting a 2-for-1 stock split that will reduce par value to $5 per share. The current market price is $14 per share. Prepare a tabular summary of the effects of the alternative actions on the components of stockholders' equity, outstanding shares, and par value per share. Stockholders' equity Paid-in capital Common stock In excess of par Total paid-in capital Retained earnings Total stockholders' equity Outstanding shares Par value per share Textbook and Media book $ $ $ Before Action LA LA $ $ After Stock Dividend LA $ $ After Stock Split
On October 31, the stockholders' equity section of Oriole Company consists of common stock $270,000 and retained earnings $884,000. Oriole is considering the following two courses of action: (1) declaring a 4% stock dividend on the 27,000, $10 par value shares outstanding, or (2) effecting a 2-for-1 stock split that will reduce par value to $5 per share. The current market price is $16 per share. Prepare a tabular summary of the effects of the alternative actions on the components of stockholders' equity, outstanding shares, and par value per share. Stockholders' equity Paid-in capital Common stock In excess of par Total paid-in capital Retained earnings Total stockholders' equity $ Outstanding shares $ Par value per share $ Before Action $ $ After Stock Dividend $ $ $ After Stock Split
On October 31, the stockholders’ equity section of Sunland Company consists of common stock $305,000 and retained earnings $891,000. Sunland is considering the following two courses of action: (1) declaring a 5% stock dividend on the 30,500, $10 par value shares outstanding, or (2) effecting a 2-for-1 stock split that will reduce par value to $5 per share. The current market price is $14 per share.Prepare a tabular summary of the effects of the alternative actions on the components of stockholders’ equity, outstanding shares, and par value per share.
On OCT 31, the stockholders' equity section of MCompany's balance sheet consists of common stock $648,000 and retained earnings $400,000. MCompany is considering the following two courses of action: (1) declaring a 5% stock dividend on the 81,000 $8 par value shares outstanding or (2) effecting a 2-for-1 stock split that will reduce par value to $4 per share. The current market price is $17 per share. Instructions Prepare a tabular summary of the effects of the alternative actions on the company's stockholders' equity and outstanding shares. Use these column headings: Before Action, After Stock Dividend, and After Stock Split. Before Action Stockholders' equity: Paid-in Capital Retained Earnings Total Stockholders Equity $ 1,048,000 $ 648,000 400,000 81,000 After Stock Dividend After Stock Split Outstanding Shares (1) By choosing stock dividend, you will be distributing 5% additional shares over the 81,000 shares "before the action". The "paid-in capital" of the stock dividend is…