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Crane Company has had 4 years of record earnings. Due to this success, the market...

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Accounting

Crane Company has had 4 years of record earnings. Due to this success, the market price of its 450,000 shares of $2 par value common stock has increased from $12 per share to $55. During this period, paid-in capital remained the same at $2,700,000. Retained earnings increased from $2,025,000 to $13,500,000. CEO Don Ames is considering either (1) a 15% stock dividend or (2) a 2-for -1 stock split. He asks you to show the before-and-after effects of each option on (a) retained earnings, (b) total stockholders' equity, and (c) par value per share.
(a)
Stock dividend - retained earnings
$
2-for-1 stock split - retained earnings
$
(b)
\table[[,Original Balances,After Dividend,After Split],[Paid-in capital,$,$,$
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