Squash Delight Inc. has the following balance sheet: Cash Accounts receivable. Fixed assets Total assets Assets Liabilities Accounts payable Notes payable Common stock (100,000 shares @ $2 par) Capital in excess of par Retained earnings Total liabilities & owners' equity Common stock Capital excess of par Retained earings Total equity $ 65,000 370,000 835,000 $1,270,000 Effect of Stock Split The firm's stock sells for $15 a share. a. Show the effect on the capital accounts of a two-for-one stock split. (Do not round intermediate calculations and round your answers to the nearest whole dollar.) $ 284,000 50,000 200,000 100,000 636,000 $1,270,000 b. Show the effect on the capital accounts of a 10 percent stock dividend. Part bis separate from part a. In part b, do not assume the stock split has taken place. (Do not round intermediate calculations and round your answers to the nearest whole dollar.)

Squash Delight Inc. has the following balance sheet: Cash Accounts receivable. Fixed assets Total assets Assets Liabilities Accounts payable Notes payable Common stock (100,000 shares @ $2 par) Capital in excess of par Retained earnings Total liabilities & owners' equity Common stock Capital excess of par Retained earings Total equity $ 65,000 370,000 835,000 $1,270,000 Effect of Stock Split The firm's stock sells for $15 a share. a. Show the effect on the capital accounts of a two-for-one stock split. (Do not round intermediate calculations and round your answers to the nearest whole dollar.) $ 284,000 50,000 200,000 100,000 636,000 $1,270,000 b. Show the effect on the capital accounts of a 10 percent stock dividend. Part bis separate from part a. In part b, do not assume the stock split has taken place. (Do not round intermediate calculations and round your answers to the nearest whole dollar.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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