E13-14 Effect of stock dividends, stock splits, and treasury stock transactions [10–15 min] Many types of transactions may affect stockholders’ equity.

Price: $ 2.99


E13-14 Effect of stock dividends, stock splits, and treasury stock transactions [10–15 min]
Many types of transactions may affect stockholders’ equity.

Requirement
1. Identify the effects of the following transactions on total stockholders’ equity.
Each transaction is independent.

A. A 10% stock dividend. Before the dividend, 520,000 shares of $1 par
common stock were outstanding; market value was $3 at the time of the dividend.

B. A 2-for-1 stock split. Prior to the split, 65,000 shares of $4 par common stock
were outstanding.

C. Purchase of 1,000 shares of treasury stock (par value at $0.50) at $3 per share.
Sale of

D. 900 shares of $0.50 par treasury stock for $5 per share. Cost of the
treasury stock was $3 per share.