Question
Crown Point Inc. is considering one of the three following courses of action: (1) paying a $0.6 cash dividend, (2) distributing a 5% stock dividend,
Crown Point Inc. is considering one of the three following courses of action: (1) paying a $0.6 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 Crown Point make its decision by completing the following chart (treat each possibility independently): Before Action After Cash Dividend After Stock Dividend After Stock Split Total assets $1,174,000 $enter a total amount for the first part $enter a total amount for the first part $enter a total amount for the first part Total liabilities $232,000 $enter a total amount for section one of the second part $enter a total amount for section one of the second part $enter a total amount for section one of the second part Shareholders equity Common shares 553,000 enter a dollar amount enter a dollar amount enter a dollar amount Retained earnings 389,000 enter a dollar amount enter a dollar amount enter a dollar amount Total shareholders equity 942,000 enter a total amount for section two of the second part enter a total amount for section two of the second part enter a total amount for section two of the second part Total liabilities and shareholders equity $1,174,000 $enter a total amount for the second part $enter a total amount for the second part $enter a total amount for the second part Number of common shares 100,000 enter a number of shares enter a number of shares enter a number of shares
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started