Which accounts of the balance sheet will change

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Question - The Retail Outlet is an all-equity firm which has 6,000 shares of stock outstanding with a par value of $10 per share. The current market value of the firm is $430,000 of which the cash balance is $114,000. The balance sheet shows the capital in excess of par account value of $136,000 and retained earnings of $234,000.

Required -

a) Which accounts of the balance sheet will change if the company declares a $0.50 regular cash dividend? Show workings.

b) What will the changes be if the company declares a 25% stock dividend? Show workings.

c) What will the changes be if the company announces a 2-for-1 stock split? Show workings.

Reference no: EM132949184

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