Problem 10-04Firm A had the following selected items on its balance sheet:Cash$27,000,000Common stock ($40 par; 2,000,000 shares outstanding) 80,000,000Additional paid-in capital 12,000,000Retained earnings 64,000,000How would each of these accounts appear after:a cash dividend of $1.5 per share? Round the number of shares outstanding to the nearest whole number and the other answers to the nearest dollar.a 7 percent stock dividend (fair market value is $80 per share)? Use the original balance sheet from the problem statement. Round the number of shares outstanding to the nearest whole number and the other answers to the nearest dollar.a one-for-two reverse split? Use the original balance sheet from the problem statement. Round the number of shares outstanding to the nearest whole number and the other answers to the nearest dollar.

The balance sheet is the statement that shows the financial position of the company. The company…

Answered: How would each of these accounts appear…

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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Problem 10-04

Firm A had the following selected items on its balance sheet:

Cash	$	27,000,000
Common stock ($40 par; 2,000,000 shares outstanding)		80,000,000
Additional paid-in capital		12,000,000
Retained earnings		64,000,000

How would each of these accounts appear after:

a cash dividend of $1.5 per share? Round the number of shares outstanding to the nearest whole number and the other answers to the nearest dollar.
a 7 percent stock dividend (fair market value is $80 per share)? Use the original balance sheet from the problem statement. Round the number of shares outstanding to the nearest whole number and the other answers to the nearest dollar.
a one-for-two reverse split? Use the original balance sheet from the problem statement. Round the number of shares outstanding to the nearest whole number and the other answers to the nearest dollar.

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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