On March 1 of the current year, Center Corporation has 500,000 shares of $10 par value common stock that are issued and outstanding. The general ledger shows the following account balances relating to the common stock: Common stock $5,000,000 Paid-in capital in excess of par value 3,500,000 On March 2, Center Corporation splits its stock 2-for-1 and reduces the par value to $5 per share. a. How many shares of common stock are issued and outstanding immediately following the stock split? Answershares b. What is the balance in the Common Stock account immediately following the stock split? $Answer c. What is the balance in the Paid-in Capital in Excess of Par Value account immediately following the stock split? $Answer
On March 1 of the current year, Center Corporation has 500,000 shares of $10 par value common stock that are issued and outstanding. The general ledger shows the following account balances relating to the common stock: Common stock $5,000,000 Paid-in capital in excess of par value 3,500,000 On March 2, Center Corporation splits its stock 2-for-1 and reduces the par value to $5 per share. a. How many shares of common stock are issued and outstanding immediately following the stock split? Answershares b. What is the balance in the Common Stock account immediately following the stock split? $Answer c. What is the balance in the Paid-in Capital in Excess of Par Value account immediately following the stock split? $Answer
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Forward Stock Split
On March 1 of the current year, Center Corporation has 500,000 shares of $10 par value common stock that are issued and outstanding. The general ledger shows the following account balances relating to the common stock:
| Common stock | $5,000,000 |
| Paid-in capital in excess of par value | 3,500,000 |
On March 2, Center Corporation splits its stock 2-for-1 and reduces the par value to $5 per share.
a. How many shares of common stock are issued and outstanding immediately following the stock split?
Answershares
b. What is the balance in the Common Stock account immediately following the stock split?
$Answer
c. What is the balance in the Paid-in Capital in Excess of Par Value account immediately following the stock split?
$Answer
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