The information below was taken from the statement of stockholders’ equity of Kidd Sports as of December 31, 1997. The par value of Kidd stock is $1, and as of the beginning of 1997 the company held ,1,500 shares in treasury. Common Stock Additional Retained Paid-In Capital Earnings Treasury Stock Beginning balances $8,000 $32,000 $27,000 $18,000 Exercised stock options (2,750) (3,000) Net income 5,600 Cash dividends (3,500) Stock dividend 700 9,800 (10,500) Ending balances $8,700 $41,800 $15,850 $15,000 Chapter 12 Stockholders’ Equity 627 REQUIRED:

a. Kidd issued common stock at one time prior to 1997. How many shares were issued and at what price per share?

b. Kidd purchased treasury stock at one time prior to 1997. How many shares were purchased and at what price?

c. At what price were the stock options exercised, and how did that price compare to the mar¬ ket value of Kidd stock at the time? Assume that the stock options were exercised imme¬ diately prior to the issuance of the stock dividend, which was recorded at market value.

d. Compute the per share dividend rate paid by Kidd during 1997, assuming that the cash div¬ idends were declared prior to the stock dividend but after the stock options were exercised.