Bramble Company has had 4 years of net income. Due to this success, the market price of its 370,000 shares of $6 par value common stock has increased from $14 per share to $54. During this period, paid-in capital remained the same at $2,220,000. Retained earnings increased from $1,750,000 to $12,100,000. President E. Rife is considering either a 16% stock dividend or a 2-for-1 stock split.
Bramble Company has had 4 years of net income. Due to this success, the market price of its 370,000 shares of $6 par value common stock has increased from $14 per share to $54. During this period, paid-in capital remained the same at $2,220,000. Retained earnings increased from $1,750,000 to $12,100,000. President E. Rife is considering either a 16% stock dividend or a 2-for-1 stock split.
Chapter15: Dividend Policy
Section: Chapter Questions
Problem 5P
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