Question

On June 30, 2021, when Crane Company's stock was selling at $65 per share, its capital accounts were as follows: Capital stock (par value $50; 57000 shares issued) $2850000 Premium on capital stock 570000 Retained earnings 4240000 If a 100% stock dividend were declared and distributed, capital stock would be $3420000. $2850000. $7410000. $5700000.

Answer 1

Answer: $2850000

Step-by-step explanation:

Based on the scenario given in the question, If a 100% stock dividend were declared and distributed, capital stock would be calculated as the number of shares issued multiplied by the percentage of shares declared and the par value. This will be:

= 57,000 × 100% × 50

= $2,850,000