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
There is not
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.
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
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.
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.
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Chapter 13 Solutions
Horngren's Accounting, The Financial Chapters, Student Value Edition (11th Edition)
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