On June 30, 2020, when ABC shares were selling for $ 65 each, the equity accounts had the following balances:               Common shares (par value $ 50: 50,000 issued) $ 2,500,000                Capital contributed in excess of par value 600,000                Retained earnings 4,200,000 A 100% share dividend is declared and distributed, the balance of the Common Shares account after recording the dividend will be: a. $2,500,000 b. $7,300,000 c. $3,100,000 d. $5,000,000

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Stockholder's Equity

The stockholders’ equity (often referred to as the book value of the company) is the number of assets available to the stockholder after its entire liabilities is paid off. The stockholders’ equity is also sometimes referred to as owner's equity. The stockholders’ equity or book value generally includes common stock, treasury stock retained earnings. It is an indicator of a company's financial strength and is an important item on the company's balance sheet.