Show the before-and-after effects of each option

Reference no: EM131770858

Question: Cullumber Company has had 4 years of record earnings. Due to this success, the market price of its 500,000 shares of $4 par value common stock has increased from $14 per share to $53. During this period, paid-in capital remained the same at $6,000,000. Retained earnings increased from $4,500,000 to $30,000,000. CEO Don Ames is considering either

(1) a 15% stock dividend or

(2) a 2-for-1 stock split. He asks you to show the before-and-after effects of each option on

(a) retained earnings,

(b) total stockholders' equity, and

Reference no: EM131770858

Questions Cloud

Can there such a thing as a truly reliable narrator : Write a summary and evaluation of how well you met the goals you set for yourself in the first week of class.

Discuss what manufacturing costs were added to wip during : What is the amount of direct materials used during 20X5. What manufacturing costs were added to WIP during 20X5

Determine the basic earnings per share for crystal arts : Crystal Arts, Inc., had earnings of $309,500 for 2016. The company had 35,000 shares of common stock outstanding during the year.

What causes led to the reformation of the 16th century : What causes led to the Reformation of the 16th Century? What were the effects of the Reformation?

Show the before-and-after effects of each option : Cullumber Company has had 4 years of record earnings. Due to this success, the market price of its 500,000 shares of $4 par value common stock has increased.

Prepare all the journal entries necessary : Culver Inc. incurred a net operating loss of $522,000 in 2017. Combined income for 2015 and 2016 was $377,000. The tax rate for all years is 30%.

Review the learning resources on the level of health care : Review the Learning Resources on the level of health care spending in the United States. Consider the ramifications of continuing at this level of spending.

Evaluate the most likely types of employment fraud : Construct a fraud scheme that would be less likely to be detected by someone using digital analysis

Straight-line method of depreciation : Straight-line method of depreciation for previously recorded assets to the double-declining-balance method.

User Account

All Pages