HiTech Manufacturing Company has 1,000,000 shares of $1 par value capital stock outstanding onJanuary 1. The following equity transactions occurred during the current year:Apr. 30 Distributed additional shares of capital stock in a 2-for-1 stock split. Market price ofstock was $35 per share.June 1 Declared a cash dividend of $0.60 per share.July 1 Paid the $0.60 cash dividend to stockholders.Aug. 1 Declared a 5 percent stock dividend. Market price of stock was $19 per share.Sept. 10 Issued shares resulting from the 5 percent stock dividend declared on August 1.a. Prepare journal entries to record the above transactions.b. Compute the number of shares of capital stock outstanding at year-end.c. What is the par value per share of HiTech Manufacturing stock at the end of the year? d. Determine the effect of each of the following on total stockholders’ equity: stock split, decla-ration and payment of a cash dividend, declaration and distribution of a stock dividend. (Your answers should be either increase, decrease, or no effect. )
HiTech Manufacturing Company has 1,000,000 shares of $1 par value capital stock outstanding on
January 1. The following equity transactions occurred during the current year:
Apr. 30 Distributed additional shares of capital stock in a 2-for-1 stock split. Market price of
stock was $35 per share.
June 1 Declared a cash dividend of $0.60 per share.
July 1 Paid the $0.60 cash dividend to stockholders.
Aug. 1 Declared a 5 percent stock dividend. Market price of stock was $19 per share.
Sept. 10 Issued shares resulting from the 5 percent stock dividend declared on August 1.
a. Prepare
b. Compute the number of shares of capital stock outstanding at year-end.
c. What is the par value per share of HiTech Manufacturing stock at the end of the year?
d. Determine the effect of each of the following on total
ration and payment of a cash dividend, declaration and distribution of a stock dividend. (Your
answers should be either increase, decrease, or no effect. )
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