Sheridan Company provides you with the following condensed balance sheet information: Current assets Equity investments Equipment (net) Intangibles Total assets Current and long-term liabilities Stockholders' equity Common stock ($5 par) Paid-in capital in excess of par Retained earnings Total liabilities and stockholders' equity (1) (2) (3) (4) Liabilities and Stockholders' Equity (5) For each of the following transactions, indicate the dollar impact (if any) on the following five items: (1) total assets, (2) common stock, (3) paid-in capital in excess of par, (4) retained earnings, and (5) stockholders' equity. (Each situation is independent.) a. Sheridan declares and pays a $0.50 per share cash dividend. Assets Total assets Common stock Paid-in capital in excess of par Retained earnings $20,200 120,300 154,200 Total stockholders' equity decrease ✓ no effect no effect decrease decrease $41,300 59,400 248,300 55,000 $404,000 < $109,300 294,700 $404,000 LA $ LA +A $ $ LA 0 0
Sheridan Company provides you with the following condensed balance sheet information: Current assets Equity investments Equipment (net) Intangibles Total assets Current and long-term liabilities Stockholders' equity Common stock ($5 par) Paid-in capital in excess of par Retained earnings Total liabilities and stockholders' equity (1) (2) (3) (4) Liabilities and Stockholders' Equity (5) For each of the following transactions, indicate the dollar impact (if any) on the following five items: (1) total assets, (2) common stock, (3) paid-in capital in excess of par, (4) retained earnings, and (5) stockholders' equity. (Each situation is independent.) a. Sheridan declares and pays a $0.50 per share cash dividend. Assets Total assets Common stock Paid-in capital in excess of par Retained earnings $20,200 120,300 154,200 Total stockholders' equity decrease ✓ no effect no effect decrease decrease $41,300 59,400 248,300 55,000 $404,000 < $109,300 294,700 $404,000 LA $ LA +A $ $ LA 0 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:Sheridan Company provides you with the following condensed balance sheet information:
Current assets
Equity investments
Equipment (net)
Intangibles
Total assets
Current and long-term liabilities
Stockholders' equity
Common stock ($5 par)
Paid-in capital in excess of par
Retained earnings
Total liabilities and stockholders' equity
(1)
(2)
(3)
(4)
Liabilities and Stockholders' Equity
(5)
Assets
Total assets
For each of the following transactions, indicate the dollar impact (if any) on the following five items: (1) total assets, (2) common stock,
(3) paid-in capital in excess of par, (4) retained earnings, and (5) stockholders' equity. (Each situation is independent.)
a. Sheridan declares and pays a $0.50 per share cash dividend.
Common stock
Paid-in capital in excess of par
Retained earnings
$20,200
Total stockholders' equity
120,300
154,200
decrease
no effect
no effect
decrease
decrease
<
$41,300
<
59,400
248,300
55,000
$404,000
$109,300
294,700
$404,000
$
LA
tA
LA
LA
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Follow-up Question

Transcribed Image Text:e. Sheridan declares a 2-for-1 stock split and issues new shares.
(1)
(2)
(3)
(4)
(5)
Total assets
Common stock
Paid-in capital in excess of par
Retained earnings
Total stockholders' equity
no effect
no effect
no effect
no effect
no effect
LA
LA
LA
LA
LA
O
O
O
O
0

Transcribed Image Text:b. Sheridan declares and issues a 10% stock dividend when the market price of the stock is
$15 per share.
(1)
(2)
(3)
(4)
(1)
(2)
(5) Total stockholders' equity
(3)
Total assets
(4)
Common stock
(5)
Paid-in capital in excess of par
Retained earnings
Total assets
Common stock
Paid-in capital in excess of par
Retained earnings
no effect
c. Sheridan declares and issues a 20% stock dividend when the market price of the stock is
$15 per share.
Total stockholders' equity
increase
increase
decrease
no effect
no effect
increase
no effect
decrease
no effect
<
$
>
LA
$
LA
$
$
LA
$
LA
$
LA
$
O
Solution
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