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Bob's Golf Emporium has been very profitable in recent years and has seen its stock price steadily increase to over $100 per share. The
Bob's Golf Emporium has been very profitable in recent years and has seen its stock price steadily increase to over $100 per share. The CFO thinks the company should consider either a 100% stock dividend or a 2-for-1 stock split. Required: 1. Complete the following table comparing the effects of a 100% stock dividend versus a 2-for-1 stock split on the stockholders' equity accounts, shares outstanding, par value, and share price. 2. State whether the statement "The primary reason companies declare a large stock dividend or a stock split is to lower the trading price of the stock to a more acceptable trading range, making it attractive to a larger number of potential investors." is true or false. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the following table comparing the effects of a 100% stock dividend versus a 2-for-1 stock split on the stockholders' equity accounts, shares outstanding, par value, and share price. (Round "Par value per share" to 2 decimal places.) After 100% After 2-for-1 Before Stock Dividend Stock Split Common stock, $1 par value Additional paid-in capital $ 1,000 58,000 Total paid-in capital 59,000 Retained earnings 23,750 Total stockholders' equity $ 82,750 Shares outstanding 1,000 Par value per share $ 1.00 Share price $ 128 < Required 1 Required 2 >
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