A firm has the following balance sheet: Assets Cash Accounts receivable Inventory Plant and equipment $...
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A firm has the following balance sheet: Assets Cash Accounts receivable Inventory Plant and equipment $ 15,000 150,000 92,000 170,000 $427,000 Liabilities and Equity Accounts payable Long-term debt Common stock ($7 par; 5,000 shares outstanding) Additional paid-in capital Retained earnings $ 15,000 88,000 35,000 149,000 140,000 $427,000 Required Part 1: Construct a new balance sheet showing the impact of a four-for-one split. If the current market price of the stock is $50, what is the price after the split? Part 2: Construct a new balance sheet showing the impact of a 15 percent stock dividend. After the stock dividend, what is the new price of the common stock? Use the original balance sheet from the problem statement. A firm has the following balance sheet: Assets Cash Accounts receivable Inventory Plant and equipment $ 15,000 150,000 92,000 170,000 $427,000 Liabilities and Equity Accounts payable Long-term debt Common stock ($7 par; 5,000 shares outstanding) Additional paid-in capital Retained earnings $ 15,000 88,000 35,000 149,000 140,000 $427,000 Required Part 1: Construct a new balance sheet showing the impact of a four-for-one split. If the current market price of the stock is $50, what is the price after the split? Part 2: Construct a new balance sheet showing the impact of a 15 percent stock dividend. After the stock dividend, what is the new price of the common stock? Use the original balance sheet from the problem statement.
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Part 1 Construct a new balance sheet showing the impact of a fourforone split New Balance Sheet Asse... View the full answer
Related Book For
Financial and Managerial Accounting the basis for business decisions
ISBN: 978-0078111044
16th edition
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
Posted Date:
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