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Unformatted text preview: the securities markets. Both techniques allow the board of directors to increase the quantity of shares and reduce share prices into a desired trading range. For accounting purposes the 20%25% rule reasonably views large stock dividends as substantive stock splits. In this case, it is necessary to capitalize par value with a stock dividend because the number of shares is increased and the par value remains the same. Earnings are capitalized for purely procedural reasons....
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- Spring '10