The owners equity accounts for Trans World International are shown here: Common Stock ($ 1 par value).............$
Question:
The owners’ equity accounts for Trans World International are shown here:
Common Stock ($ 1 par value).............$ 25,000
Capital surplus........................................170,000
Retained earnings..................................530,000
Total owners’ equity........................... $725,000
a. If Trans World stock currently sells for $35 per share and a 10 percent stock dividend is declared, how many new shares will be distributed? Show how the equity accounts would change.
b. If Trans World declared a 25 percent stock dividend, how would the accounts change?
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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a The shares outstanding increases by 10 percent so New shares outstanding 25000110 New shar...View the full answer
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Related Book For 
Essentials Of Corporate Finance
ISBN: 9780073405131
6th Edition
Authors: Stephen A. Ross, Randolph Westerfield, Bradford D. Jordan
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