On April 30, the equity section of Isaac's Icecream Bar consists 81. Share Capital - Ordinary: Share Premium - Ordinary: Retained Earnings $1,000,000 $10,000 $750,000 Isaac is considering the following two options: Оption I: Declaring a 10% share dividend on the 70,000, $12 par value shares outstanding Option 2: Effecting a 4-for-1 share split that will reduce par value to $3 per share. The current market price is $15 per share.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Prepare a tabular summary of the effects of the alternative actions by completing the following
table.
After Share
After Share
Before Action
Dividend
Split
Accounts
Share Capital - Ordinary
Share Premium - Ordinary
Retained Earnings
Total Equity
Outstanding Shares
Par Value Per Share
Transcribed Image Text:Required: Prepare a tabular summary of the effects of the alternative actions by completing the following table. After Share After Share Before Action Dividend Split Accounts Share Capital - Ordinary Share Premium - Ordinary Retained Earnings Total Equity Outstanding Shares Par Value Per Share
On April 30, the equity section of Isaac's Icecream Bar consists of:
Share Capital - Ordinary:
Share Premium - Ordinary:
$1,000,000
$10,000
Retained Earnings
$750,000
Isaac is considering the following two options:
Оption I:
Declaring a 10% share dividend on the 70,000, $12 par value shares outstanding
Оption 2:
Effecting a 4-for-1 share split that will reduce par value to $3 per share.
The current market price is $15 per share.
Transcribed Image Text:On April 30, the equity section of Isaac's Icecream Bar consists of: Share Capital - Ordinary: Share Premium - Ordinary: $1,000,000 $10,000 Retained Earnings $750,000 Isaac is considering the following two options: Оption I: Declaring a 10% share dividend on the 70,000, $12 par value shares outstanding Оption 2: Effecting a 4-for-1 share split that will reduce par value to $3 per share. The current market price is $15 per share.
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