In the Chart Below, Assign the Directional Effect (I =

question 31

Essay

In the chart below, assign the directional effect (I = increase, D = decrease, or NE = no effect) of each of the following six transactions on the components of the book value of common shareholders' equity.
a. Small stock dividend declared and issued.
b. 2-for-1 stock split announced and issued.
c. Stock options granted.
d. Recognition of compensation expense on stock options.
e. Stock options exercised.
f. Stock options expired.
$\begin{array}{c}\begin{array}{|l|}\hline \text {Item}\\\\\hline \text {a.}\\\hline \text {b.}\\\hline \text {c.}\\\hline \text {d.}\\\hline \text {e.}\\\hline \text {f.}\\\hline \end{array}\begin{array}{l|}\hline \text {Common Stock}\\\\\hline\\\hline\\\hline\\\hline \\\hline\\\hline\\\hline\end{array}\begin{array}{l|}\hline \text {Additional Paid-In}\\\text {Capital}\\\hline \\\hline \\\hline\\\hline \\\hline \\\hline \\\hline\end{array}\begin{array}{l|}\hline \text {Deferred}\\\text {Compensation}\\\hline\\\hline \\\hline \\\hline \\\hline\\\hline\\\hline \end{array}\begin{array}{l|}\hline \text {Retained}\\\text {Earrings}\\\hline \\\hline\\\hline \\\hline\\\hline \\\hline \\\hline\end{array}\begin{array}{l|}\hline \text {Treasuiy Stock}\\ \text {at Cost}\\\hline \\\hline \\\hline \\\hline \\\hline \\\hline \\\hline\end{array}\begin{array}{l|}\hline \text {Total Common}\\\text {Shareholders'Equity}\\\hline \\\hline \\\hline \\\hline \\ \hline\\ \hline\\\hline \end{array}\end{array}$

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Definitions:

Monetary Values

The value of an object, service, or resource expressed in terms of money or currency.

Opportunity Loss Table

A table used in decision analysis that quantifies the difference between the payoff from the best action and all other actions for each state of nature.

Payoff Table

A decision-making tool used in statistics and business to show the expected outcomes of different decisions under various states of nature.

Decision Matrix

A tool used in decision-making to evaluate and prioritize a list of alternatives or options, based on a set of criteria.