Question:
APPLY THE CONCEPTS: Determine the effect on stockholders
You've examined how a stock dividend affects the company, and you know that the total number of shares outstanding has increased by 10%. What does this mean for shareholders? Assume that you are a shareholder who owns 15% of the company in question prior to the stock dividend. Based on what you know about the effects of a stock dividend, fill in the table concerning the postAc€?ostock dividend situation.
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Before Stock Dividend
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After Stock Dividend
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Total shares issued by company
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6,000
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Number of shares owned by you
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900
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Proportionate ownership
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15%
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%
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