The Owners equity accounts for Quadrangle International are shown here:
Common stock ($1 par value) $30,000
Capital surplus 285,000
Retained earnings 649,000
Total owners equity $964,180
a. If Quadrangle stock currently sells for $30 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 Quadrangle declared a 25 percent stock dividend, how would the accounts change?
3. For the company in problem 2, show how the equity accounts will change if:
a. Quadrangle declares a four-for-one stock split. How many shares are outstanding now? What is he new par value per share?
b. Quadrangle declares a one-for-five reverse stock split. How many shares are outstanding now? What is the new par value per share?