Reference no: EM132142264

Squash Delight Inc. has the following balance sheet:

Assets   

Cash $ 45,000    

Accounts receivable   295,000    

Fixed assets   772,000         

Total assets $ 1,112,000   

Liabilities  

Accounts payable $ 296,000    

Notes payable   54,000    

Common stock (100,000 shares @ $2 par)   200,000    

Capital in excess of par   100,000    

Retained earnings   462,000         

Total liabilities & owners' equity $ 1,112,000

The firm's stock sells for $14 a share.

a. What is the effect on the capital accounts of a two-for-one stock split? (Do not round intermediate calculations and round your answers to the nearest whole dollar.)

Common stock: _________

Capital Excess of par:___________

Retained Earnings:____________

Total equity:______________

b. What is the effect on the capital accounts of a 10 percent stock dividend? Part b is separate from part a. In part b do not assume the stock split has taken place. (Do not round intermediate calculations and round your answers to the nearest whole dollar.)

Common stock: _________

Capital Excess of par:___________

Retained Earnings:____________

Total equity:______________