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Exercise 11-6 Dynatech Inc. is considering one of the three following courses of action: (1) paying a $0.60 cash dividend, (2) distributing a 5% stock
Exercise 11-6 Dynatech Inc. is considering one of the three following courses of action: (1) paying a $0.60 cash dividend, (2) distributing a 5% stock dividend, or (3) effecting a 2-for-1 stock split. The current share price is $13 per share. Help Dynatech 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 $1,346,000 $ $ $ Total liabilities $237,000 $ $ Shareholders' equity Common shares 656,000 Retained earnings 453,000 Total shareholders' equity 1,109,000 liabilities and shareholders' equity $1,346,000 $ Number of common shares 100,000
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