Unit 8 Assignment Q5

On October 31, the stockholders' equity section of Sheridan Company consists of common stock $280.000 and retained earnings 5886.000 Sheridan is considering the following two courses of action: (1) dedaring a 73. stock dividend on the 28,000, $10 par value shares outstanding or (2) effecting a 2-for-1 stock split that will reduce par value to 55 per share. The current market price is $16 per share Prepare a tabular summary of the effects of the alternative actions on the components of stockholders' equity. outstanding shares, and par value per share. Before Action After Stock Dividend After Stock Split Stockholders' equity Paid-in capital Common stock $ S $ In excess of par Total paid-in capital Retained earnings Total stockholders equity S $ S Outstanding shares $ $ Par value per share e Textbook and Media Attempts: 0 of Sused Subalt Ander Save for Later