Question

The owners’ equity accounts for Octagon International are shown here:
Common stock ($1 par value) .......... $25,000
Capital surplus ................... 195,000
Retained earnings .............. 734,600
Total owners’ equity ............. $954,600
a. If Octagon 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 Octagon declared a 25 percent stock dividend, how would the accounts change?


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  • CreatedOctober 01, 2015
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