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How much of a reduction in retained earnings results

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Question - The stockholders' equity accounts of Lawrence Company have the following balances on December 31, 2010.

Common stock, $10 par, 200,000 shares issued and outstanding $2,000,000

Paid-in capital in excess of par 1,200,000

Retained earnings 5,600,000

Shares of Lawrence Company stock are currently selling on the Midwest Stock Exchange at $37.

How much of a reduction in retained earnings results when a 2-for-1 stock split is declared and issued.

Reference no: EM131778311

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