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The shareholders’ equity account for Kowloonia Trust is shown here: Common Stocks (1,000 shares outstanding) $600,000...

The shareholders’ equity account for Kowloonia Trust is shown here:

Common Stocks (1,000 shares outstanding) $600,000

Retained Earning                                        $790,000

Total    $1,390,000

a) If Kowloonia declares a three-for-one stock split, how many shares will be outstanding? Show how the equity accounts will change.

b) If Kowloonia declares a one-for-four reverse stock split, how many shares will be outstanding? Show how the equity accounts will change.

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