Stock split: The Stock split is a process undertaken by the corporation in which it divide its share of larger nominal value in to large number of shares of smaller nominal value. The process is undertaken by the company to reduce the market value of its shares and to keep it under control as it will get diluted in larger number of shares. The effect of stock split is that there is no change in total stockholder’s equity or any other account in the Stockholder’s equity section amount-wise. Rather just the par value of authorized and issued stock capital of respective category gets diluted by increasing the number of shares. There is not journal entry is passed for there is no change in amount of stock capital. However, a memorandum journal entry without any debit and credit amount is passed in the books by debiting the stock capital (gets splitted) with nominal value and crediting it with new nominal value for getting it changed in the books. Stock Dividend: The Dividend is the return provided by the corporation to its investors in anticipation of profits earned on the amount invested. The Dividend may be two forms: One on which there are commitment of assets to be paid i.e. cash (referred as Cash dividend) and other when the free sharers are issued to the investors in proportion of their holdings (referred as Stock dividend).There is no change in total assets and total stockholder’s equity in case of Stock dividend. Only the amounts in various accounts within Stockholders’ account changes. Treasury Stock : The Treasury stock is a own stock capital which has been purchased by the corporation for reissue it again among the inventors or for retirement of stock capital especially preferred stock capital which contain fixed preferred dividend commitment. Whenever, the corporation observed surplus money in the business and favorable market prices, it purchased its own stock in the open market at a prevalent price and carried in the books as reduction in stockholder’s equity and issued shares. Requirement a: The effect of Stock dividend on the Stockholder’s equity of the corporation.

Question

Want to see the full answer?

Answer 1

Question

Chapter 13, Problem E13.31E

To determine

Stock split:

The Stock split is a process undertaken by the corporation in which it divide its share of larger nominal value in to large number of shares of smaller nominal value. The process is undertaken by the company to reduce the market value of its shares and to keep it under control as it will get diluted in larger number of shares.

The effect of stock split is that there is no change in total stockholder’s equity or any other account in the Stockholder’s equity section amount-wise. Rather just the par value of authorized and issued stock capital of respective category gets diluted by increasing the number of shares.

There is not journal entry is passed for there is no change in amount of stock capital. However, a memorandum journal entry without any debit and credit amount is passed in the books by debiting the stock capital (gets splitted) with nominal value and crediting it with new nominal value for getting it changed in the books.

Stock Dividend:

The Dividend is the return provided by the corporation to its investors in anticipation of profits earned on the amount invested. The Dividend may be two forms: One on which there are commitment of assets to be paid i.e. cash (referred as Cash dividend) and other when the free sharers are issued to the investors in proportion of their holdings (referred as Stock dividend).There is no change in total assets and total stockholder’s equity in case of Stock dividend. Only the amounts in various accounts within Stockholders’ account changes.

Treasury Stock:

The Treasury stock is a own stock capital which has been purchased by the corporation for reissue it again among the inventors or for retirement of stock capital especially preferred stock capital which contain fixed preferred dividend commitment.

Whenever, the corporation observed surplus money in the business and favorable market prices, it purchased its own stock in the open market at a prevalent price and carried in the books as reduction in stockholder’s equity and issued shares.

Requirement a:

The effect of Stock dividend on the Stockholder’s equity of the corporation.

To determine

Requirement-b:

The effect of Stock split on the Stockholder’s equity of the corporation.

To determine

Requirement-c:

The effect of purchase of treasury stock on the Stockholder’s equity of the corporation.

To determine

Requirement-d:

The effect on stockholder’s equity section of sale of treasury stock.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

River is a salaried exempt worker who earns $73,630 per year for a 35-hour workweek. During a biweekly pay period, River worked 105 hours. What is the gross pay?

The industrial enterprise "HUANG S.A." purchased a sorting and packaging machine from a foreign company on 1/4/2017 at a cost of €500,000. The useful life of the machine was estimated by the Management at ten (10) years, while the residual value was estimated at zero. For the transportation of the machine from abroad to the company's factory, the amount of €20,000 was paid on 15/4/2017. As the insurance coverage of the machine during transportation was the responsibility of the selling company, HUANG S.A. proceeded to insure the machine from 16/4/2017 to 15/4/2018, paying the amount of €1,200. The delivery took place on 15/4/2017. As adequate ventilation of the multifunction device is essential for its proper operation, the company fitted an air duct on the multifunction device. The cost of the air duct amounted to €2,000 and was paid on 20/4/2017. On 25/4/2017, an external electrician was paid €5,000 for the electrical connection of the device. The company also paid €5,000 to an…

Answer 2

Question

Chapter 13, Problem E13.31E

To determine

Stock split:

The Stock split is a process undertaken by the corporation in which it divide its share of larger nominal value in to large number of shares of smaller nominal value. The process is undertaken by the company to reduce the market value of its shares and to keep it under control as it will get diluted in larger number of shares.

The effect of stock split is that there is no change in total stockholder’s equity or any other account in the Stockholder’s equity section amount-wise. Rather just the par value of authorized and issued stock capital of respective category gets diluted by increasing the number of shares.

There is not journal entry is passed for there is no change in amount of stock capital. However, a memorandum journal entry without any debit and credit amount is passed in the books by debiting the stock capital (gets splitted) with nominal value and crediting it with new nominal value for getting it changed in the books.

Stock Dividend:

The Dividend is the return provided by the corporation to its investors in anticipation of profits earned on the amount invested. The Dividend may be two forms: One on which there are commitment of assets to be paid i.e. cash (referred as Cash dividend) and other when the free sharers are issued to the investors in proportion of their holdings (referred as Stock dividend).There is no change in total assets and total stockholder’s equity in case of Stock dividend. Only the amounts in various accounts within Stockholders’ account changes.

Treasury Stock:

The Treasury stock is a own stock capital which has been purchased by the corporation for reissue it again among the inventors or for retirement of stock capital especially preferred stock capital which contain fixed preferred dividend commitment.

Whenever, the corporation observed surplus money in the business and favorable market prices, it purchased its own stock in the open market at a prevalent price and carried in the books as reduction in stockholder’s equity and issued shares.

Requirement a:

The effect of Stock dividend on the Stockholder’s equity of the corporation.

To determine

Requirement-b:

The effect of Stock split on the Stockholder’s equity of the corporation.

To determine

Requirement-c:

The effect of purchase of treasury stock on the Stockholder’s equity of the corporation.

To determine

Requirement-d:

The effect on stockholder’s equity section of sale of treasury stock.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 13, Problem E13.31E

To determine

Stock split:

The Stock split is a process undertaken by the corporation in which it divide its share of larger nominal value in to large number of shares of smaller nominal value. The process is undertaken by the company to reduce the market value of its shares and to keep it under control as it will get diluted in larger number of shares.

The effect of stock split is that there is no change in total stockholder’s equity or any other account in the Stockholder’s equity section amount-wise. Rather just the par value of authorized and issued stock capital of respective category gets diluted by increasing the number of shares.

There is not journal entry is passed for there is no change in amount of stock capital. However, a memorandum journal entry without any debit and credit amount is passed in the books by debiting the stock capital (gets splitted) with nominal value and crediting it with new nominal value for getting it changed in the books.

Stock Dividend:

The Dividend is the return provided by the corporation to its investors in anticipation of profits earned on the amount invested. The Dividend may be two forms: One on which there are commitment of assets to be paid i.e. cash (referred as Cash dividend) and other when the free sharers are issued to the investors in proportion of their holdings (referred as Stock dividend).There is no change in total assets and total stockholder’s equity in case of Stock dividend. Only the amounts in various accounts within Stockholders’ account changes.

Treasury Stock:

The Treasury stock is a own stock capital which has been purchased by the corporation for reissue it again among the inventors or for retirement of stock capital especially preferred stock capital which contain fixed preferred dividend commitment.

Whenever, the corporation observed surplus money in the business and favorable market prices, it purchased its own stock in the open market at a prevalent price and carried in the books as reduction in stockholder’s equity and issued shares.

Requirement a:

The effect of Stock dividend on the Stockholder’s equity of the corporation.

To determine

Requirement-b:

The effect of Stock split on the Stockholder’s equity of the corporation.

To determine

Requirement-c:

The effect of purchase of treasury stock on the Stockholder’s equity of the corporation.

To determine

Requirement-d:

The effect on stockholder’s equity section of sale of treasury stock.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 13, Problem E13.31E

To determine

Stock split:

The Stock split is a process undertaken by the corporation in which it divide its share of larger nominal value in to large number of shares of smaller nominal value. The process is undertaken by the company to reduce the market value of its shares and to keep it under control as it will get diluted in larger number of shares.

The effect of stock split is that there is no change in total stockholder’s equity or any other account in the Stockholder’s equity section amount-wise. Rather just the par value of authorized and issued stock capital of respective category gets diluted by increasing the number of shares.

There is not journal entry is passed for there is no change in amount of stock capital. However, a memorandum journal entry without any debit and credit amount is passed in the books by debiting the stock capital (gets splitted) with nominal value and crediting it with new nominal value for getting it changed in the books.

Stock Dividend:

The Dividend is the return provided by the corporation to its investors in anticipation of profits earned on the amount invested. The Dividend may be two forms: One on which there are commitment of assets to be paid i.e. cash (referred as Cash dividend) and other when the free sharers are issued to the investors in proportion of their holdings (referred as Stock dividend).There is no change in total assets and total stockholder’s equity in case of Stock dividend. Only the amounts in various accounts within Stockholders’ account changes.

Treasury Stock:

The Treasury stock is a own stock capital which has been purchased by the corporation for reissue it again among the inventors or for retirement of stock capital especially preferred stock capital which contain fixed preferred dividend commitment.

Whenever, the corporation observed surplus money in the business and favorable market prices, it purchased its own stock in the open market at a prevalent price and carried in the books as reduction in stockholder’s equity and issued shares.

Requirement a:

The effect of Stock dividend on the Stockholder’s equity of the corporation.

To determine

Requirement-b:

The effect of Stock split on the Stockholder’s equity of the corporation.

To determine

Requirement-c:

The effect of purchase of treasury stock on the Stockholder’s equity of the corporation.

To determine

Requirement-d:

The effect on stockholder’s equity section of sale of treasury stock.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 13, Problem E13.31E

To determine

Stock split:

The Stock split is a process undertaken by the corporation in which it divide its share of larger nominal value in to large number of shares of smaller nominal value. The process is undertaken by the company to reduce the market value of its shares and to keep it under control as it will get diluted in larger number of shares.

The effect of stock split is that there is no change in total stockholder’s equity or any other account in the Stockholder’s equity section amount-wise. Rather just the par value of authorized and issued stock capital of respective category gets diluted by increasing the number of shares.

There is not journal entry is passed for there is no change in amount of stock capital. However, a memorandum journal entry without any debit and credit amount is passed in the books by debiting the stock capital (gets splitted) with nominal value and crediting it with new nominal value for getting it changed in the books.

Stock Dividend:

The Dividend is the return provided by the corporation to its investors in anticipation of profits earned on the amount invested. The Dividend may be two forms: One on which there are commitment of assets to be paid i.e. cash (referred as Cash dividend) and other when the free sharers are issued to the investors in proportion of their holdings (referred as Stock dividend).There is no change in total assets and total stockholder’s equity in case of Stock dividend. Only the amounts in various accounts within Stockholders’ account changes.

Treasury Stock:

The Treasury stock is a own stock capital which has been purchased by the corporation for reissue it again among the inventors or for retirement of stock capital especially preferred stock capital which contain fixed preferred dividend commitment.

Whenever, the corporation observed surplus money in the business and favorable market prices, it purchased its own stock in the open market at a prevalent price and carried in the books as reduction in stockholder’s equity and issued shares.

Requirement a:

The effect of Stock dividend on the Stockholder’s equity of the corporation.

To determine

Requirement-b:

The effect of Stock split on the Stockholder’s equity of the corporation.

To determine

Requirement-c:

The effect of purchase of treasury stock on the Stockholder’s equity of the corporation.

To determine

Requirement-d:

The effect on stockholder’s equity section of sale of treasury stock.

Answer 6

Chapter 13, Problem E13.31E

To determine

Stock split:

The Stock split is a process undertaken by the corporation in which it divide its share of larger nominal value in to large number of shares of smaller nominal value. The process is undertaken by the company to reduce the market value of its shares and to keep it under control as it will get diluted in larger number of shares.

The effect of stock split is that there is no change in total stockholder’s equity or any other account in the Stockholder’s equity section amount-wise. Rather just the par value of authorized and issued stock capital of respective category gets diluted by increasing the number of shares.

There is not journal entry is passed for there is no change in amount of stock capital. However, a memorandum journal entry without any debit and credit amount is passed in the books by debiting the stock capital (gets splitted) with nominal value and crediting it with new nominal value for getting it changed in the books.

Stock Dividend:

The Dividend is the return provided by the corporation to its investors in anticipation of profits earned on the amount invested. The Dividend may be two forms: One on which there are commitment of assets to be paid i.e. cash (referred as Cash dividend) and other when the free sharers are issued to the investors in proportion of their holdings (referred as Stock dividend).There is no change in total assets and total stockholder’s equity in case of Stock dividend. Only the amounts in various accounts within Stockholders’ account changes.

Treasury Stock:

The Treasury stock is a own stock capital which has been purchased by the corporation for reissue it again among the inventors or for retirement of stock capital especially preferred stock capital which contain fixed preferred dividend commitment.

Whenever, the corporation observed surplus money in the business and favorable market prices, it purchased its own stock in the open market at a prevalent price and carried in the books as reduction in stockholder’s equity and issued shares.

Requirement a:

The effect of Stock dividend on the Stockholder’s equity of the corporation.

Answer 7

Chapter 13, Problem E13.31E

To determine

Stock split:

The Stock split is a process undertaken by the corporation in which it divide its share of larger nominal value in to large number of shares of smaller nominal value. The process is undertaken by the company to reduce the market value of its shares and to keep it under control as it will get diluted in larger number of shares.

The effect of stock split is that there is no change in total stockholder’s equity or any other account in the Stockholder’s equity section amount-wise. Rather just the par value of authorized and issued stock capital of respective category gets diluted by increasing the number of shares.

There is not journal entry is passed for there is no change in amount of stock capital. However, a memorandum journal entry without any debit and credit amount is passed in the books by debiting the stock capital (gets splitted) with nominal value and crediting it with new nominal value for getting it changed in the books.

Stock Dividend:

The Dividend is the return provided by the corporation to its investors in anticipation of profits earned on the amount invested. The Dividend may be two forms: One on which there are commitment of assets to be paid i.e. cash (referred as Cash dividend) and other when the free sharers are issued to the investors in proportion of their holdings (referred as Stock dividend).There is no change in total assets and total stockholder’s equity in case of Stock dividend. Only the amounts in various accounts within Stockholders’ account changes.

Treasury Stock:

The Treasury stock is a own stock capital which has been purchased by the corporation for reissue it again among the inventors or for retirement of stock capital especially preferred stock capital which contain fixed preferred dividend commitment.

Whenever, the corporation observed surplus money in the business and favorable market prices, it purchased its own stock in the open market at a prevalent price and carried in the books as reduction in stockholder’s equity and issued shares.

Requirement a:

The effect of Stock dividend on the Stockholder’s equity of the corporation.

Answer 8

To determine

Requirement-b:

The effect of Stock split on the Stockholder’s equity of the corporation.

Answer 9

To determine

Requirement-b:

The effect of Stock split on the Stockholder’s equity of the corporation.

Answer 10

To determine

Requirement-c:

The effect of purchase of treasury stock on the Stockholder’s equity of the corporation.

Answer 11

To determine

Requirement-c:

The effect of purchase of treasury stock on the Stockholder’s equity of the corporation.

Answer 12

To determine

Requirement-d:

The effect on stockholder’s equity section of sale of treasury stock.

Answer 13

To determine

Requirement-d:

The effect on stockholder’s equity section of sale of treasury stock.

Answer 14

Expert Solution & Answer

Answer 15

Expert Solution & Answer

Answer 16

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 17

Ch. 13 - Prob. 1QC Ch. 13 - Prob. 2QC Ch. 13 - Prob. 3QC Ch. 13 - Prob. 4QC Ch. 13 - Prob. 5QC Ch. 13 - Prob. 6QC Ch. 13 - Prob. 7QC Ch. 13 - Prob. 8QC Ch. 13 - Prob. 9QC Ch. 13 - Prob. 10QC

Requirement-b: The effect of Stock split on the Stockholder’s equity of the corporation.

Requirement-c: The effect of purchase of treasury stock on the Stockholder’s equity of the corporation.

Requirement-d: The effect on stockholder’s equity section of sale of treasury stock.

Want to see the full answer?

Chapter 13 Solutions

Requirement-b:

The effect of Stock split on the Stockholder’s equity of the corporation.

Requirement-c:

The effect of purchase of treasury stock on the Stockholder’s equity of the corporation.

Requirement-d:

The effect on stockholder’s equity section of sale of treasury stock.