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I need help with the large stock dividend. How did they get 1,053,000?

I need help with the large stock dividend. How did they get 1,053,000?

FINANCIAL ACCOUNTING
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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I need help with the large stock dividend. How did they get 1,053,000?

On July 1, Davidson Corporation had the following capital structure: $ 702,000 960,000 Common stock ( $3 par value) Additional paid-in capital Retained earnings Treasury stock 760,000 Required: Complete the table below for each of the two following independent cases: Note: Round "Par value per share" amounts to 2 decimal places. Case 1: The board of directors declared and issued a 50 percent stock dividend when the stock was selling at $5 per share. Case 2: The board of directors announced a 6-for-5 stock split. The market price prior to the split was $5 per share. Items Common stock account Par value per share Shares outstanding Additional paid-in capital Retained earnings Total stockholders' equity $ $ $ $ $ Before Dividend and Split $ 3.00 $ 0 702,000 234,000 960,000 $ 760,000 $ 2,422,000 $ After Stock Dividend $ 3.00 $ 1,053,000 351,000 960,000 409,000 $ $ 2,422,000 After Stock Split 702,000 2.50 280,800 960,000 760,000 2,422,000
Transcribed Image Text:On July 1, Davidson Corporation had the following capital structure: $ 702,000 960,000 Common stock ( $3 par value) Additional paid-in capital Retained earnings Treasury stock 760,000 Required: Complete the table below for each of the two following independent cases: Note: Round "Par value per share" amounts to 2 decimal places. Case 1: The board of directors declared and issued a 50 percent stock dividend when the stock was selling at $5 per share. Case 2: The board of directors announced a 6-for-5 stock split. The market price prior to the split was $5 per share. Items Common stock account Par value per share Shares outstanding Additional paid-in capital Retained earnings Total stockholders' equity $ $ $ $ $ Before Dividend and Split $ 3.00 $ 0 702,000 234,000 960,000 $ 760,000 $ 2,422,000 $ After Stock Dividend $ 3.00 $ 1,053,000 351,000 960,000 409,000 $ $ 2,422,000 After Stock Split 702,000 2.50 280,800 960,000 760,000 2,422,000
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