Brief Exercise 11-6 Your answer is partially correct. Try again. $9 par $1,089,0

ID: 2571449 • Letter: B

Question

Brief Exercise 11-6 Your answer is partially correct. Try again. $9 par $1,089,000 and retained earnings $500,000 A 15% stock dividend The stockholders' equity section of Whispering Winds Corp.'s balance sheet consists of common stock (18,150 shares) is declared when the market price per share is $17. (a) Show the before-and-after effects of the dividend on the components of stockholders' equity Before Dividend After Dividend Stockholders Equity Paid-in Capital Common Stock 1089000 1252350 Paid-in Capital in Excess of Par Value-Common Stock (b) Show the before-and-after effects of the dividend on the shares outstanding Before Dividend After Dividend Outstanding shares

Explanation / Answer

Particulars

Before Dividend

After Dividend

Stockholders’ equity

Paid in capital

Common stock, $9 par

$1089000

$1252350

Paid in capital in excess of

par value-common stock

$145200

Total paid in capital

$1089000

$1397550

Retained earnings

$500000

$191450

Total stockholders’ equity

$1589000

Paid in capital in excess of par value common stock:

$17 - $9 = $8.

$8*18150 shares = $145200.

Retained earnings after dividend:

Stock dividend = $17 * 18150 shares =$308550

Retained earnings after dividend = Retained earnings before dividend – stock dividend

$500000 - $308550 = $191450

b) Shares outstanding