Stock Dividends – The market value balance sheet for Outbox Manufacturing is shown here. Outbox has declared a 25 percent stock dividend. The stock goes ex dividend tomorrow (the chronology for a stock dividend is similar to that for a cash dividend). There are 20,000 shares of stock outstanding. What will the ex-dividend price be?
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Market Value Balance Sheet |
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|
Cash |
$230,000 |
Debt |
$190,000 |
|
Fixed assets |
415,000 |
Equity |
455,000 |
|
Total |
$645,000 |
Total |
$645,000 |