Question

RBC Financial Group provides personal and commercial banking, wealth management services, insurance, corporate and investment banking, and transaction processing services on a global basis. On March 3, 2006, a press release announced the following:
Royal Bank of Canada ( RY: TSX, NYSE, SWX) today announced that its Board of Directors has declared a stock dividend, which has the same effect as a two- for- one split of its common shares.
RBC’s last stock dividend was paid on October 5, 2000.
The Board of Directors today also declared a quarterly common share cash dividend of $ 0.72 per share, which represents $ 0.36 per share on a post- stock dividend basis. This dividend of $ 0.36 per share is payable on May 24, 2006, to common shareholders of record on April 25, 2006.
Required:
1. Prepare any journal entries that RBC Financial should make as the result of information in the preceding report. Assume that the company has 1.3 million shares outstanding with a market value of $ 47 per share and an average issue price of $ 5.60.
2. What factors did the board of directors consider in making this decision?


$1.99
Sales0
Views19
Comments0
  • CreatedAugust 04, 2015
  • Files Included
Post your question
5000