On October 31, the stockholders equity section of Pele Companys balance sheet consists of common stock $514,200 and retained earnings $417,000.

Pele is considering the following two courses of action:

(1) Declaring a 5% stock dividend on the 85,700 $6 par value shares outstanding (2) Effecting a 2-for-1 stock split that will reduce par value to $3 per share.

The current market price is $14 per share.

Prepare a tabular summary of the effects of the alternative actions on the companys stockholders equity and outstanding shares.

Exercise 11-7 On October 31, the stockholders' equity section of Pele Company's balance sheet consists of common stock $514,200 and retained earnings $417,000 Pele is considering the following two courses of action: (1) Declaring a 5% stock dividend on the 85,700 $6 par value shares outstanding (2) Effecting a 2-for-1 stock split that will reduce par value to $3 per share. The current market price is $14 per share. Prepare a tabular summary of the effects of the alternative actions on the company's stockholders' equity and outstanding shares Pele Company's Balance Sheet Before Action After Stock Dividend After Stock Split Stockholders' equity Paid-in capital Retained earnings Total stockholders' equity Outstanding shares