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Problem:

CBA Inc has 280,000 shares outstanding with a $5.5 par value. The shares were issued for $15.5. The stock is currently selling for $27.5. CBA has $6,000,000 in retained earnings and has declared a stock dividend that will increase the number of outstanding shares by 6.50%.

Required:

Question: What will be the capital in excess of par account after the stock dividend?

$2,800,000
$3,200,400
$4,359,900
$9,200,400

Note: Explain in detail and show all computations in proper way.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91167772

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