On June 30, 2016, Sharper Corporation\'s common stock is priced at $32.00 per sh

Question

On June 30, 2016, Sharper Corporation's common stock is priced at $32.00 per share before any stock dividend or split, and the stockholders' equity section of its balance sheet appears as follows Common stock-$6 par value, 80,000 shares authorized 32,000 shares issued and outstanding Paid-in capital in excess of par value, common stock Retained earnings Total stockholders' equity $192,000 100,000 292,000 $584,000 1. Assume that the company declares and immediately distributes a 100% stock dividend. This event is recorded by capitalizing retained earnings equal to the stock's par value. Answer these questions about stockholders' equity as it exists after issuing the new shares. a.,b.& c. Complete the below table to calculate the retained earnings balance, total stockholders' equity and number of outstanding shares. Before Stock Dividend Impact of Stock Dividend After Stock Dividend Stock Dividend Common stock Paid in capital in excess of par value Total contributed capital Retained Earnings Total Stockholders' Equity S 192,000 100,000 292,000 292,000 S 584,000 100,000 100,000 0 100,000 Number of common shares outstanding

Explanation / Answer

Stock dividend Before stock dividend Impact of stock dividend After stock dividend Common stock $192000 $192000 $384000 Paid in capital in excess of par value 100000 100000 Total paid in capital 292000 $192000 $484000 Retained earnings 292000 ($192000) $100000 Total stockholders equity 584000 0 $584000 Number of common shares outstanding 32000 shares 32000 shares 64000 shares.

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