7 8 E15-13 (Stock Split and Stock Dividend) The common stock of Alexander Hamilton Inc. is currentlyselling at $120 per share. The directors wish to reduce the share price and increase share volume prior to anew issue. The per share par value is $10; book value is $70 per share. Nine million shares are issued andoutstanding.Instructionsnolto viisPrepare the necessary journal entries assuming the following.(a) The board votes a 2-for-1 stock split.(b) The board votes a 100% stock dividend.(c) Briefly discuss the accounting and securities market differences between these two methods ofincreasing the number of shares outstanding.

A stock split is a business action when a corporation divides its current shares into numerous…

8 E15-13 (Stock Split and Stock Dividend) The common stock of Alexander Hamilton Inc. is currently selling at $120 per share. The directors wish to reduce the share price and increase share volume prior to a new issue. The per share par value is $10; book value is $70 per share. Nine million shares are issued and outstanding. Instructions Prepare the necessary journal entries assuming the following. (a) The board votes a 2-for-1 stock split. (b) The board votes a 100% stock dividend. (c) Briefly discuss the accounting and securities market differences between these two methods of increasing the number of shares outstanding.

8 E15-13 (Stock Split and Stock Dividend) The common stock of Alexander Hamilton Inc. is currently selling at $120 per share. The directors wish to reduce the share price and increase share volume prior to a new issue. The per share par value is $10; book value is $70 per share. Nine million shares are issued and outstanding. Instructions Prepare the necessary journal entries assuming the following. (a) The board votes a 2-for-1 stock split. (b) The board votes a 100% stock dividend. (c) Briefly discuss the accounting and securities market differences between these two methods of increasing the number of shares outstanding.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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