Inter Company declared and issued a 5% stock dividend on May 1, 2011. Before this dividend was

Question:

Inter Company declared and issued a 5% stock dividend on May 1, 2011. Before this dividend was declared and issued, there were 120,000 shares of $0.50 par common stock outstanding. After the stock dividend, how many shares are outstanding? What is the par value of each share?

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...