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Business, 12.03.2020 21:14 legendman27

The Western Pipe Company has the following capital section in its balance sheet. Its stock is currently selling for $5 per share.

Common stock (40,000 shares at $2 par) $80,000
Capital in excess of par 80,000
Retained earnings 180,000
Total equity $340,000

The firm intends to first declare a 15 percent stock dividend and then pay a 25-cent cash dividend (which also causes a reduction of retained earnings).

Required:
Show the capital section of the balance sheet after the first transaction and then after the second transaction.

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