Piper Paper Products (PPP) Limiteds stock is currently trading at $23 per share. PPP is considering a 15 percent stock dividend. Equity accounts are shown below: Common stock (585,000 shares) $585,000

Retained earnings $3,720,000

Total owners equity $4,305,000

a) How many new shares will be distributed as a result of the stock dividend?

b) Show how the equity accounts will change as a result of the stock dividend?

c) Assuming a perfect market, what will the share price be after the stock dividend?

d) Suppose the company instead decides on a three-for-one stock split. The firms 80 cent per share cash dividend on the new (post-split) shares represents an increase of 5 percent over last years dividend on the pre-split stock. What effects does this have on the equity accounts? What was last years dividend per share?