Myers Company provides you with the following condensed balance sheet informatio
ID: 2422714 • Letter: M
Question
Myers Company provides you with the following condensed balance sheet information.
Assets
Liabilities and Stockholders’ Equity
For each transaction below, 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.)
(a) Myers declares and pays a $0.51 per share cash dividend.
(b) Myers declares and issues a 10% stock dividend when the market price of the stock is $14 per share.
(c) Myers declares and issues a 40% stock dividend when the market price of the stock is $16 per share.
(d) 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. ABC is selling for $11 per share on the date the property dividend is declared.
(e) Myers declares a 2-for-1 stock split and issues new shares.
Assets
Current assets $ 40,500 Equity investments (ABC stock; 11,000 shares at cost) 66,000 Equipment (net) 251,900 Intangibles 60,520 Total assets $418,920Liabilities and Stockholders’ Equity
Current and long-term liabilities $104,900 Stockholders’ equity Common stock ($5 par) $ 31,500 Paid-in capital in excess of par 115,600 Retained earnings 166,920 314,020 Total liabilities and stockholders’ equity $418,920Explanation / Answer
Total assets Common stock Paid-in capital in excess of par Retained earnings Total stockholders' equity a. Decrease by $ 3,213 No effect No effect Decrease by $ 3,213 Decrease by $ 3,213 b. No effect Increase by $ 3,150 Increase by $ 5,670 Decrease by $ 8,820 No effect c. No effect Increase by $ 12,600 No effect Decrease by $ 12,600 No effect d. Decrease by $ 34,650 No effect No effect Decrease by $ 34,650 Decrease by $ 34,650 e. No effect No effect No effect No effect No effect
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