Mgmt 200 Assignment Soln 4-16-10

Mgmt 200 Assignment Soln 4-16-10 - Management 200...

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Management 200 – Introductory Financial Accounting– Spring 2010 Krannert School of Management - Purdue University Solutions to class assignment for April 16, 2010 Problem 11-5 Dividends and Stock Splits 1. March 1 Retained Earnings and total stockholders’ equity decrease. April 1 Total stockholders’ equity remains unchanged. June 1 Common Stock Distributable increases by $7,500 (15,000 X 5% X $10). Additional Paid-in Capital—Common Stock increases by $6,000 (15,000 X 5% X 8). Retained Earnings decrease by $13,500. Total stockholders’ equity does not change. July 1 Common Stock Distributable decreases and common stock increases by $7,500. Sept. 1 Retained Earnings and total stockholders’ equity decrease by $7,875 [(15,000 + 750) X $.50]. Oct. 1 Total stockholders’ equity does not change. Dec. 1 The par value of common stock changes from $10 to $5 as the number of shares issued and outstanding doubles from 15,750 to 31,500, but the total par value does not change. The total stockholders’ equity also
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This note was uploaded on 05/25/2010 for the course MGMT 200 taught by Professor Greigg during the Spring '08 term at Purdue.

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Mgmt 200 Assignment Soln 4-16-10 - Management 200...

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