Question
P149 Stock dividend: Firm Columbia Paper has the following stockholders equity account. The firms common stock has a current market price of $30 per share.
P149 Stock dividend: Firm Columbia Paper has the following stockholders equity account. The firms common stock has a current market price of $30 per share. Preferred stock $100,000 Common stock (10,000 shares at $2 par) $20,000 Paid-in capital in excess of par $280,000 Retained earnings $100,000 Total stockholders equity $500,000 a. Show the effects on Columbia of a 5% stock dividend. b. Show the effects of (1) a 10% and (2) a 20% stock dividend. c. In light of your answers to parts a and b, discuss the effects of stock dividends on stockholders equity. Please show all your work.
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