Smart Mart Inc. is considering one of three options: (1) paying a $0.40 cash dividend, (2) distributing

Question:

Smart Mart Inc. is considering one of three options: (1) paying a $0.40 cash dividend, (2) distributing a 5% stock dividend, or (3) effecting a 2-for-1 stock split. The current fair value is $14 per share.

Instructions

Help Smart Mart decide what to do by completing the following chart (treat each possibility independently):

Smart Mart Inc. is considering one of three options: (1)

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1200000 60000 shares 5 14 1242000 Total assets Total liabilities Common shares Retained earnin...View the full answer

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Question Posted: Mar 30, 2017 12:38 PM

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Smart Mart Inc. is considering one of three options: (1) paying a $0.40 cash dividend, (2) distributing

Question:

After Cash Dividend After Stock Dividend After Stock Split Before Action $1,875,000 $ 75,000 1200,000 Total assets Total liabilities Common shares Retained earnings Total shareholders' equity Total liabilities and shareholders' equity Number of common shares 600,000 $1,875,000 60,000

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1200000 60000 shares 5 14 1242000 Total assets Total liabilities Common shares Retained earnin...View the full answer

Accounting Principles Part 3

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