On July 1, Davidson Corporation had the following capital structure: Common stock ($3 par value) Additional paid-in capital Retained earnings Treasury stock Required: $ 600,000 1,030,000 780,000 0 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 40 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. Before Dividend and Split After Stock Dividend After Stock Split Items Common stock account Par value per share $ 3.00 Shares outstanding Additional paid-in capital $ 1,030,000 Retained earnings $ 780,000 Total stockholders' equity
On July 1, Davidson Corporation had the following capital structure: Common stock ($3 par value) Additional paid-in capital Retained earnings Treasury stock Required: $ 600,000 1,030,000 780,000 0 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 40 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. Before Dividend and Split After Stock Dividend After Stock Split Items Common stock account Par value per share $ 3.00 Shares outstanding Additional paid-in capital $ 1,030,000 Retained earnings $ 780,000 Total stockholders' equity
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Dineshbhai
Transcribed Image Text:On July 1, Davidson Corporation had the following capital structure:
Common stock ($3 par value)
Additional paid-in capital
Retained earnings
Treasury stock
Required:
$ 600,000
1,030,000
780,000
0
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 40 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.
Before Dividend
and Split
After Stock
Dividend
After Stock
Split
Items
Common stock account
Par value per share
$
3.00
Shares outstanding
Additional paid-in capital
$
1,030,000
Retained earnings
$
780,000
Total stockholders' equity
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