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Stock Rividend Comparison Althougb Oriolk Copaoy has snough retainet carniogs legally.to.dedate a stii- deod, its wockiog sapital is low, The board of stirecrors is.consideriog
Stock Rividend Comparison Althougb Oriolk Copaoy has snough retainet carniogs legally.to.dedate a stii- deod, its wockiog sapital is low, The board of stirecrors is.consideriog atock dividend instead of a sash stivideod. The common stock is currently selling at $34 per share. The following is Oriole's current sharcholders' equity: Common stock, $10 par Additional paidin capital on common stock Total contributed capital Retained earnings Total shareholders' equity $ 400,000 800,000 $1,200,000 1,300,000 $2,500,000 Required: 1. Assuming a 15% stock dividend is declared and issued, prepare the sharcholders' cquity section immediately after the date of issuance. 2. Assuming, instcad, that a 30% stock dividend is declared and issued, prepare the shareholders' equity section immediately after the date of issuance. 3. Next Level What unusual result do you notice when you compare your answers from Requirement 1 with Requirement 2? From a theoretical standpoint, how might this have been avoided?
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