9th Edition

ISBN: 9781260216141

Author: SPICELAND

Publisher: MCG CUSTOM

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Stock indexes are used to compare the price fluctuations of a group of stocks of similar companies, which are combined based on a similar industry or a particular market capitalization limit or type of market. The price comparison is based on a pre-deter…

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Chapter 18, Problem 18.15BE

Stock split

• LO18–8

Refer to the situation described in BE 18–13, but assume a 2-for-1 stock split instead of the 5% stock dividend. Prepare the journal entry to record the stock split if it is to be effected in the form of a 100% stock dividend. What is the par per share after the split?

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Chapter 18, Problem 18.14BE

Chapter 18, Problem 18.16BE

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ol ! 1 Current Attempt in Progress On October 31, the stockholders' equity section of Cullumber Company consists of common stock $370,000 and retained earnings $904,000. Cullumber is considering the following two courses of action: (1) declaring a 6% stock dividend on the 37,000, $10 par value shares outstanding, or (2) effecting a 2-for-1 stock split that will reduce par value to $5 per share. The current market price is $16 per share. Prepare a tabular summary of the effects of the alternative actions on the components of stockholders' equity, outstanding shares, and par value per share. After After Stock Stock Before Action Dividend Split Stockholders' equity Paid-in capital Q A Common stock In excess of par NO 2 N Total paid-in capital Retained earnings Total stockholders' equity Outstanding shares 30 W S #3 X H 1 option command E D $ Ad 4 $ $ 288 FA R C do L % 5 F T V MacBook Air F6 < 6 G Y B & 7 H 90 U W 00 8 N DI J ( 1 9 DE K M D O MOSISO L F H D Р W 1 . ( command 1 ?

Chapter 18 Solutions

INTERMEDIATE ACCOUNTING(LL)-W/CONNECT

Ch. 18 - Identify and briefly describe the two primary...Ch. 18 - Prob. 18.2Q Ch. 18 - Prob. 18.3Q Ch. 18 - Prob. 18.4Q Ch. 18 - Prob. 18.5Q Ch. 18 - Prob. 18.6Q Ch. 18 - Prob. 18.7Q Ch. 18 - What is meant by a shareholders preemptive right?Ch. 18 - Terminology varies in the way companies...Ch. 18 - Most preferred shares are cumulative. Explain what...

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Stock split • LO18–8 Refer to the situation described in BE 18–13, but assume a 2-for-1 stock split instead of the 5% stock dividend. Prepare the journal entry to record the stock split if it is to be effected in the form of a 100% stock dividend. What is the par per share after the split?

Solution Summary: The author explains stock splits are a method of increasing the total number of outstanding shares thereby, reducing the market price of each share, but keeping the corporation's total market value constant.

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Chapter 18 Solutions