Discuss the alternative actions on the companys stockholders

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On October 31, the stockholders' equity section of Sheridan Company's balance sheet consists of common stock $582,000 and retained earnings $407,000. Sheridan is considering the following two courses of action:

(1) Declaring a 6% stock dividend on the 97,000 $6 par value shares outstanding

(2) Effecting a 2-for-1 stock split that will reduce par value to $3 per share.

The current market price is $18 per share.

Prepare a tabular summary of the effects of the alternative actions on the company's stockholders' equity and outstanding shares.

Reference no: EM131769955

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