Shares multiplied by the market value per share

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Reference no: EM132070506

Southern Fried Chicken has 8,000 shares of stock outstanding with a par value of $1 per share and a market value of $34 per share. The balance sheet shows $39,000 in the capital in excess of par account, $8,000 in the common stock account, and $152,000 in the retained earnings account. The firm just announced a 5 percent stock dividend. What will total owners' equity be after the dividend?

A. $185,800

B. $196,000

C. $199,000

D. $206,800

E. $212,200

Total equity will not change as this is a small stock dividend

Total equity = $39,000 + $8,000 + $152,000 = $199,000

Why Total equity will not change as this is a small stock dividend, why the equity value can't be calculate as the no of shares multiplied by the market value per share?

Reference no: EM132070506

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