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Canarie Inc. is considering one of the three following courses of action: (1) paying a $0.40 cash dividend, (2) distributing a 5% stock dividend,
Canarie Inc. is considering one of the three following courses of action: (1) paying a $0.40 cash dividend, (2) distributing a 5% stock dividend, or (3) effecting a 2-for-1 stock split. The current share price is $15 per share. Help Canarie make its decision by completing the following chart (treat each possibility independently): (2) Total assets Total liabilities Shareholders' equity (1) Before Action After Cash Dividend $1,369,000 $ $240,000 SA $ EA $ $ EA After Stock Dividend Common shares 586,000 Retained earnings 543,000 Total shareholders' equity 1,129,000 Total liabilities and shareholders' equity $1,369,000 $ $ Number of common shares 100,000 $ | to A
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Lets analyze the impact of each action on Canarie Incs financial statements Understanding the Actions Before we fill in the chartlets clarify what each action implies Cash Dividend A portion of the co...Get Instant Access to Expert-Tailored Solutions
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