Many types of transactions may affect stockholders' equity. Identify the effects of the following transactions on total

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Many types of transactions may affect stockholders' equity. Identify the effects of the following transactions on total stockholders' equity. Each transaction is independent.

a. A 10% stock dividend. Before the dividend, 540,000 shares of $1 par value common stock were outstanding; market value was $9 per share at the time of the dividend.

b. A 2-for-1 stock split. Prior to the split, 66,000 shares of $5 par value common stock were outstanding.

c. Purchase of 1,100 shares of $0.50 par treasury stock at $6 per share.

d. Sale of 600 shares of $0.50 par treasury stock for $9 per share. Cost of the treasury stock was $7 per share.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...
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Horngrens Financial And Managerial Accounting The Financial Chapters

ISBN: 9780134486840

6th Edition

Authors: Tracie L. Miller Nobles, Brenda L. Mattison, Ella Mae Matsumura

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