What would be the amount and direction of the change

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Question - The shareholders' equity of ABC Company at July 31, 2018 is presented below:

Common shares, no par value, authorized 400,000 shares; Issued and outstanding 200,000 shares $4,160,000

Retained earnings 2,650,000

$6,810,000

On August 1, 2018, the board of directors of ABC declared a 4% stock dividend on common shares, to be distributed on September 15. The market price of ABC's common shares was $28 on August 1, 2018, and $25 on September 15, 2018.

What would be the amount and direction of the change to Retained Earnings as a result of the declaration and distribution of this stock dividend?

Reference no: EM132829035

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