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Category > Accounting Posted 09 May 2017 My Price 6.00

The common stock of Brandy, Inc

The common stock of Brandy, Inc is currently selling at $120 per share. The directors wish to reduce the share price and increase share volume prior to a new issue. The per share par value is $10; book value is $70 per share. Nine million shares are issued and outstanding.

 

Required:

Prepare the necessary journal entries assuming the following.

 

(a)  The board declares and issues a 2-for-1 stock split.

(b)  The board declares and issues a 100% stock dividend.

(c)  Briefly discuss the accounting and securities market differences between these two methods of increasing the number of shares outstanding.

Answers

(15)
Status NEW Posted 09 May 2017 02:05 AM My Price 6.00

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file 1494295485-Solutions file.docx preview (56 words )
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