Squash Delight Inc. has the following balance sheet:

Assets

Cash

$

60,000

Accounts receivable

287,000

Fixed assets

775,000

Total assets

$

1,122,000

Liabilities

Accounts payable

$

275,000

Notes payable

53,000

Common stock (120,000 shares @ $2 par)

240,000

Capital in excess of par

100,000

Retained earnings

454,000

Total liabilities & owners' equity

$

1,122,000

The firms stock sells for $10 a share. a. Show the effect on the capital accounts of a two-for-one stock split.

	Split
Common stock
Capital excess of par
Retained earnings
Total equity

b. Show the effect on the capital accounts of a 10 percent stock dividend. Part b is separate from part a. In part b do not assume the stock split has taken place.

	Effect of Stock Dividend
Common stock
Capital excess of par
Retained earnings
Total equity