Problem 10-07

What effect will a two-for-one stock split have on the following items found on a firm's financial statements?

a) Earnings per share $4.00. Round your answer to the nearest cent.

Initial amount	New amount	Effect
$4.00	$ ________	Increase, Decrease, or No Change?

b) Total equity $11,000,000. Round your answer to the nearest dollar.

Initial amount

New amount

Effect

$11,000,000

$ __________

Increase, Decrease, or No Change?

c) Long-term debt $4,100,000. Round your answer to the nearest dollar.

Initial amount	New amount Effect
$4,100,000	$ __________ Increase, Decrease, or No Change

d) Additional paid-in capital $1,536,000. Round your answer to the nearest dollar.

Initial amount	New amount	Effect
$1,536,000	$ ____________	Increase, Decrease or No Change

e) Number of shares outstanding 1,100,000. Round your answer to the nearest whole number.

Initial amount	New amount	Effect
1,100,000	$__________	increase, decrease, or no change

f) Earnings $4,400,000. Round your answer to the nearest dollar.

Initial amount	New amount	Effect
$4,400,000	$__________	Increase, decrease or no change