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On October 31, the stockholders' equity section of Ivanhoe Company's balance sheet consists of common stock $332,000 and retained earnings $393,000. Ivanhoe is considering the
On October 31, the stockholders' equity section of Ivanhoe Company's balance sheet consists of common stock $332,000 and retained earnings $393,000. Ivanhoe is considering the following two courses of action: (1) Declaring a 6% stock dividend on the 83,000 $4 par value shares outstanding 2) Effecting a 2-for-1 stock split that will reduce par value to $2 per share The current market price is $16 per share. Prepare a tabular summary of the effects of the alternative actions on the company's stockholders' equity and outstanding shares. Ivanhoe Company's Balance Sheet Before Action After Stock Dividend After Stock Split Stockholders' equity Paid-in capital Retained earnings Total stockholders' equity$ Outstanding shares
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