The owners’ equity accounts for Vase Corporation are shown here: Common stock (€3 par value) Capital surplus Retained earnings Total owners’ equity €900,000 1,200,000 2,600,000 4,700,000 Instructions: 1. If the company’s stock currently sells for €58 per share and a 15 percent stock dividend is declared, how many new shares will be distributed? Show how the equity accounts would change. 2. Assume that instead of a stock dividend, the company declares a three-for-one stock split. How the equity accounts will change? How many shares are outstanding now? What is the new par value per share
The owners’ equity accounts for Vase Corporation are shown here: Common stock (€3 par value) Capital surplus Retained earnings Total owners’ equity €900,000 1,200,000 2,600,000 4,700,000 Instructions: 1. If the company’s stock currently sells for €58 per share and a 15 percent stock dividend is declared, how many new shares will be distributed? Show how the equity accounts would change. 2. Assume that instead of a stock dividend, the company declares a three-for-one stock split. How the equity accounts will change? How many shares are outstanding now? What is the new par value per share
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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The owners’ equity accounts for Vase Corporation are shown here:
Common stock (€3 par value) Capital surplus
Total owners’ equity
€900,000 1,200,000 2,600,000 4,700,000
Instructions:
1. If the company’s stock currently sells for €58 per share and a 15 percent stock dividend is declared, how many new shares will be distributed? Show how the equity accounts would change.
2. Assume that instead of a stock dividend, the company declares a three-for-one stock split. How the equity accounts will change? How many shares are outstanding now? What is the new par value per share?
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