Question

The stockholders’ equity section of Riverbed Corp’s balance sheet consists of common stock ($9 par) $1,179,000 and retained earnings $430,000. A 15% stock dividend (19,650 shares) is declared when the market price per share is $15.

(a) Show the before-and-after effects of the dividend on the components of stockholders’ equity.

		Before Dividend		After Dividend
select an opening section name                                                          Current AssetsCurrent LiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesNet Income / (Loss)Property, Plant and EquipmentStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders' EquityPaid-in CapitalTotal Paid-in Capital
select an opening subsection name                                                          Current AssetsCurrent LiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesNet Income / (Loss)Property, Plant and EquipmentStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders' EquityPaid-in CapitalTotal Paid-in Capital
enter a balance sheet item		$enter a dollar amount		$enter a dollar amount
enter a balance sheet item		enter a dollar amount		enter a dollar amount
select a closing subsection name                                                          Current AssetsCurrent LiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesNet Income / (Loss)Property, Plant and EquipmentStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders' EquityPaid-in CapitalTotal Paid-in Capital		enter a subtotal of the two previous amounts		enter a subtotal of the two previous amounts
enter a balance sheet item		enter a dollar amount		enter a dollar amount
select a closing section name                                                          Current AssetsCurrent LiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesNet Income / (Loss)Property, Plant and EquipmentStockholders' EquityTotal AssetsTotal Current AssetsTotal Current LiabilitiesTotal Intangible AssetsTotal LiabilitiesTotal Liabilities and Stockholders' EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Property, Plant and EquipmentTotal Stockholders' EquityPaid-in CapitalTotal Paid-in Capital		$enter a total amount for this section		$enter a total amount for this section

(b) Show the before-and-after effects of the dividend on the shares outstanding.

		Before Dividend		After Dividend
Outstanding shares		enter a dollar amount

Answer 1

(a) Show the before-and-after effects of the dividend on the components of stockholders’ equity.

		Before Dividend		After Dividend
Stockholder's equity
Paid in capital
Common Stock		1179000		19650*9+1179000 = 1355850
Additional paid in capital				19650*6 = 117900
Total paid in capital		1179000		1473750
Retained earnings		430000		430000-294750 = 135250
Total Stockholder's equity		1609000		1609000

(b) Show the before-and-after effects of the dividend on the shares outstanding.

		Before Dividend			After Dividend
Outstanding shares		131000			150650