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The Western Pipe Company has the following capital section in its balance sheet. Its stock is...

The Western Pipe Company has the following capital section in its balance sheet. Its stock is currently selling for $4 per share.

  Common stock (65,000 shares at $2 par) $ 130,000
  Capital in excess of par 130,000
  Retained earnings 250,000
  Total equity $ 510,000

The firm intends to first declare a 10 percent stock dividend and then pay a 15-cent cash dividend (which also causes a reduction of retained earnings).

Show the capital section of the balance sheet after the first transaction and then after the second transaction.

             Western Pipe Co. After Stock Dividend

Common Stock:____________________

Capital in access of par:______________

Retained Earnings:__________________

Total Equity:_______________________

              Western Pipe Co. After Stock Dividend

Common Stock:____________________

Capital in access of par:______________

Retained Earnings:__________________

Total Equity:_______________________

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