Hitech Manufacturing Company has 1,000,000 shares of $1 par value capital stock outstanding on January 1. The following equity transaction occurred during the current year:
April 30 Distributed additional shares of capital stock in a 2-for-1 stock split. Market price of stock was $35 per share.
June 1 Declared a cash dividend of 60 cents per share.
July 1 Paid the 60-cent cash dividend to stockholders.
Aug. 1 Declared a 5 percent stock dividend. Market price of stock was $19 per share.
Sept 1. Issued shares resulting from the 5 percent stock dividend declared on Aug 1.
a) Prepare journal entries to record the above transaction
b) compute the number of shares of capital stock outstanding year-end.
c) What is the par value per share Hitech Manufacturing stock at the end year?
d) Determine the effect of each of the following on total stockholders' equity: stock split, declaration and payment of a cash dividend, declaration and distribution of a stock dividend.