The owners equity accounts for Okanagan International are shown here: Common stock ($1 par value) ....................... $

Question:

The owners’ equity accounts for Okanagan International are shown here:

Common stock ($1 par value) ....................... $ 20,000
Capital Surplus ................................................ 285,000
Retained earnings .......................................... 638,120
Total owners’ equity ................................... $ 943,120

a. If Okanagan 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 Okanagan declared a 25 percent stock dividend, how would the accounts change?

Dividend
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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