Lance Products’ balance sheet includes total assets of $587,000 and

Lance Products’ balance sheet includes total assets of $587,000 and the following equity account balances at December 31, 2011:
Common stock, $2 par, 80,000 shares issued and outstanding .... $160,000
Additional paid-in capital—common stock ........... 24,000
Total capital stock ...................... $184,000
Retained earnings ...................... 217,000
Total stockholders’ equity .................. $401,000
Lance’s common stock is selling for $12 per share on December 31, 2011.

Required:
1. How much would Lance Products have reported for total assets and retained earnings on December 31, 2011, if the firm had declared and paid a $15,000 cash dividend on December 31, 2011? Prepare the journal entry for this cash dividend.
2.
How much would Lance have reported for total assets and retained earnings on December 31, 2011, if the firm had issued a 15 percent stock dividend on December 31, 2011? Prepare the journal entry for this stock dividend.
3.
How much would Lance have reported for total assets and retained earnings on December 31, 2011, if the firm had effected a 2-for-1 stock split on December 31, 2011? Is a journal entry needed to record the stock split? Why or why not?
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...
Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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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