The stockholders' equity section of Augusta, Inc.is as follows:
The market price of the stock on December 31, 2015, was $8 per share.Answer the following independent questions:
A) Calculate the average amount at which each share of common stock was initially sold.
B) What balance will be in the retained earnings account immediately after the declaration of a 2- for-1 stock split?
C) If a cash dividend of $1 per share was declared to both common and preferred stockholders, what would be the balance in retained earnings immediately after the declaration?
D) What balance will be in the retained earnings account immediately after the declaration of a 20% common stock dividend on December 31, 2015?
Correct Answer:
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