Explore BrainMass

Explore BrainMass

    The company with the common equity accts shown here has decl

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    The company with the common equity accounts shown here has declared a 12 percent dividend at a time when the market value of its stock is $35 per share.

    common stock ($1 per value 198,000
    capital surplus 1,753,000
    Retained earnings 3,500,700
    Total owners equity 5,451,700

    Suppose the company instead decides on a five for one stock split. The firm's 70 cent per share cash dividend on the new (post-split) shares represents an increase of 10 percent over last year's dividend on the pre-split stock. What effect does this have on equity accounts? What was last year's dividend per share?

    © BrainMass Inc. brainmass.com June 4, 2020, 12:41 am ad1c9bdddf

    Solution Preview

    The equity accounts are unchanged except the new par value of the ...

    Solution Summary

    The solution provides detailed explanations and calculations for the problem.