Problem $10-3$A $($Algo$)$ Indicate effect of stock dividends and stock splits $($LO$10-6)$

Big Meadows Sports has been very profitable in recent years and has seen its stock price steadily increase to over $$100$ per share. The CFO thinks the company should consider either a $100\%$ stock dividend or a $2-$for$-1$ stock split.

Required:

Complete the following table comparing the effects of a $100\%$ stock dividend versus a $2-$for$-1$ stock split on the stockholders' equity accounts, shares outstanding, par value, and share price.

State whether the statement "The primary reason companies declare a large stock dividend or a stock split is to lower the trading price of the stock to a more acceptable trading range, making it attractive to a larger number of potential investors." is true or false.

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Complete the following table comparing the effects of a $100\%$ stock dividend versus a $2-$for$-1$ stock split on the stockholders' equity accounts, shares outstanding, par value, and share price. $($Round "Par value per share" to $2$ decimal places.$)$

$\backslash$table$[[,$Before,$\backslash$table$[[$After $100\%],[$Stock$],[$Dividend$]],\backslash$table$[[$After $2-$for$-1],[$Stock Split$]]],[$Common stock, $$1$ par value,$$1,200,,],[$Additional paid$-$in capital,$51,000,,],[$Total paid$-$in capital,$52,200,,],[$Retained earnings,$23,050,,]]$