Blossom Company has had 4 years of record earnings. Due to this success, the market price of its $405,000 shares of $4 par value common stock has increased from $14 per share to $55. During this period, paid-in capital remained the same at $4,860,000. Retained earnings increased from $3,645,000 to $24,300,000. CEO Don Ames is considering either (1) a 15% stock dividend or (2) a 2-for-1 stock split. He asks you to show the before-and-after effects of each option on (a) retained earnings, (b) total stockholders' equity, and (c) par value per share.

(a)

1. Stock dividend - retained earnings = $
2. 2-for-1 stock split - retained earnings = $

(b) Blossom Company

Original Balance After Dividend After Split

Paid-in-Capital $ $ $

Retained Earnings $ $ $

Total Stockholder's $ $ $

equity

Shares Outstanding $ $ $

(c)

1. Stock dividend - par value per share = $
2. 2-for-1 stock split - par value per share = $