Columbia Paper has the following stockholders' equity account. The firm's common stock has a current market price of $35 per share.       

Preferred stock $120,000

Common stock (10,000 shares at $2 par) 20,000

Paid-in capital in excess of par 330,000

Retained earnings 90,000

Total stockholders' equity $560,000

a.  Show the effects on Columbia of a 20% stock dividend.

Part 1-The preferred stock of Columbia after a 20% stock dividend is $   (Round to the nearest dollar.)

Part 2-The common stock of Columbia after a 20% stock dividend is $      (Round to the nearest dollar.)

Part 3- The paid-in capital of Columbia after a 20% stock dividend is $      (Round to the nearest dollar.)

Part 4- The retained earnings of Columbia after a 20% stock dividend is $      (Round to the nearest dollar.)

Part 5- The total stockholder's equity of Columbia after a 15% stock dividend is $      (Round to the nearest dollar.)

b.  In light of your answers to part a, discuss the effects of a stock dividend on stockholders' equity. Question content area bottom

Answer rating: 100% (QA)

Solution Stock dividend 20 Number of shares 10000 No of shares ... View the full answer