(Dividends and Splits) Myers Company provides you with the following condensed balance sheet information.
Asset
Current assets \(40,000
Equipment (net) 250,000
Intangibles 60,000
Total assets \)410,000
Liabilities and Stockholders’ Equity
Current and long-term liabilities \(100,000
Stockholders’ equity
Common stock (\)5 par) \( 20,000
Paid-in capital in excess of par 110,000
Retained earnings 180,000 310,000
Total liabilities and stockholders’ equity \)410,000
Instructions
For each of the following transactions, indicate the dollar impact (if any) on the following five items: (1) total assets, (2) common stock, (3) paid-in capital in excess of par, (4) retained earnings, and (5) stockholders’ equity. (Each situation is independent.)
- Myers declares and pays a \(0.50 per share cash dividend.
- Myers declares and issues a 10% stock dividend when the market price of the stock is \)14 per share.
- Myers declares and issues a 30% stock dividend when the market price of the stock is \(15 per share.
- Myers declares and distributes a property dividend. Myers gives one share of its equity investment (ABC stock) for every two shares of Myers Company stock held. Myers owns 10,000 shares of ABC. ABC is selling for \)10 per share on the date the property dividend is declared.
- Myers declares a 2-for-1 stock split and issues new shares.
