The Western Pipe Company has the following capital section in its balance sheet. Its stock is currently selling for $4 per share. Common stock (60,000 shares at $1 par) Capital in excess of par Retained earnings Total equity $ 60,000 60,000 180,000 $300,000 The firm intends to first declare a 5 percent stock dividend and then pay a 20-cent cash dividend (which also causes a reduction of retained earnings). Show the capital section of the balance sheet after the first transaction and then after the second transaction. (Do not round Intermediate calculations and round your answers to the nearest whole dollar.) Western Pipe Co.
The Western Pipe Company has the following capital section in its balance sheet. Its stock is currently selling for $4 per share. Common stock (60,000 shares at $1 par) Capital in excess of par Retained earnings Total equity $ 60,000 60,000 180,000 $300,000 The firm intends to first declare a 5 percent stock dividend and then pay a 20-cent cash dividend (which also causes a reduction of retained earnings). Show the capital section of the balance sheet after the first transaction and then after the second transaction. (Do not round Intermediate calculations and round your answers to the nearest whole dollar.) Western Pipe Co.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:The Western Pipe Company has the following capital section in its balance sheet. Its stock is currently selling for $4 per share.
Common stock (60,000 shares at $1 par)
Capital in excess of par
$ 60,000
60,000
180,000
Retained earnings
Total equity
$300,000
The firm intends to first declare a 5 percent stock dividend and then pay a 20-cent cash dividend (which also causes a reduction of
retained earnings).
Show the capital section of the balance sheet after the first transaction and then after the second transaction. (Do not round
Intermediate calculations and round your answers to the nearest whole dollar.)
Western Pipe Co.
After Stock Dividend
Common stock
Capital in excess of par
Retained earnings
Total equity
Western Pipe Co.
After Cash Dividend
Common stock
Capital in excess of par
Retained earnings
Total equity
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