The owners’ equity accounts for Alexander International are show below:
Common Stock ($.50 par value, 40,000 shares outstanding)$ 20,000
Capital Surplus 285,000
Retained Earnings 638,120
Total Owners’ Equity$ 933,120
1. If Alexander International’s stock sells for $30 per share, and if a 10% stock dividend is declared, How many new shares will be distributed?
2. How would the equity accounts change in “A” above?
Now, assume that, instead of a stock dividend, the company declares a 4-for-1 stock split.
1. How many shares will be outstanding?
2. What is the new par value per share?
Now, assume that, instead of a stock dividend or a stock split, the company declares a 1-for-5 reverse stock split.
1. How many shares will be outstanding?
2. What is the new par value per share?