Question
Stock dividend Firm Columbia Paper has the following stockholders' equity account. The firm's common stock has a current market price of $30 per share. Preferred
Stock
dividendFirm
Columbia Paper has the following stockholders' equity account. The firm's 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.In light of your answers to part
a,
discuss the effects of stock dividend on stockholders' equity.
Question content area bottom
Part 1
a.The preferred stock of Columbia after a
5%
stock dividend is
$enter your response here.
(Round to the nearest dollar.)
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