The Terry George Company has the following equity accounts on its balance sheet:

Common Stock ($1 par, 700,000 shares)$700,000

Contributed Capital in excess of par$3,000,000

Retained Earnings$15,000,000

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$18,700,000

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The current market price of the firm's shares is $60

(a)If the firm declares a 10 percent stock dividend, what will be the impact on the firm's equity accounts? Show revised equity account balances (10 points).

(b)If the firm currently pays no cash dividend, what is the impact of a 10 percent stock dividend on the wealth position of the firm's existing stockholders? (2 points).