On October 31, the stockholders' equity section of Pharoah Company's balance sheet consists of common stock $768,000 and retained earnings $406,000. Pharoah is considering the following two courses of action: (1) declaring a 5% stock dividend on the 96,000,$8 par value shares outstanding or (2) effecting a 2-for-1 stocksplit that will reduce par value to $4 per share. The current market price is $14 per share