Accounting for Stock Dividends and Stock Splits The Irvine Corporation reported
ID: 2450173 • Letter: A
Question
Accounting for Stock Dividends and Stock Splits
The Irvine Corporation reported the following data at year-end:
The following transactions occurred during the year in the following sequence:
1. Declared and distributed a 10% stock dividend on the outstanding common shares at a time when the common shares were selling for $15 per share.
2. Declared a 3-for-2 forward stock split on the outstanding common shares.
3. Declared and issued a 20% stock dividend on the outstanding common shares at a time when the shares were selling for $30 per share.
4. Declared a 2-for-1 forward stock split on the outstanding common shares.
Calculate the par value per share and number of shares outstanding at year-end. Prepare the shareholders’ equity section of the balance sheet for the Irvine Corporation at year-end.
Do not round until your final answers.
Par value per share at year end. Round to two decimal places.
$Answer
Number of shares outstanding at year end. Round to nearest whole number.
Answer
Do not use rounded answers in your calculations.Enter all answers in the nearest whole number and show all work.
Common stock, par value $1 $100,000 Additional paid-in-capital 300,000 Retained earnings 1,400,000 Treasury shares (600,000) Other comprehensive income 200,000 Total shareholders’ equity $1,400,000Explanation / Answer
Common stock outstanding(100000/264000)=0.378 100000 (264000*0.378) Additional paid in capital 300000 Retained earnings 1368000 Tresury Stock -600000 other comprehensive income 200000 Total shareholders equity 1368000