Lakeview Company Reported the Following Amounts on Its Balance Sheet

question 28

Essay

Lakeview Company reported the following amounts on its balance sheet at December 1, 2015:
The following transactions occurred during December:
1. Declared a 20% stock dividend on common stock on December 3, when the stock was selling at $12 per share. The stock dividend will be distributed on December 20, 2015.
2. Distributed the common stock dividend on December 20.
3. Approved a 2-for-1 stock split of the common stock on December 28, when the stock was selling for $20 per share.
A Show the effect of the transactions on the accounting equation.
B Answer the following questions:
1. How many common shares are outstanding at December 31, 2015?
2. What effect will the stock split have on the stock's market value?

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Definitions:

Agricultural Society

A society that is primarily focused on agriculture and farming as the main source of livelihood and economic activity.

Non-Hierarchical Group

A group organized without levels of authority, where all members have equal status and decision-making is often collaborative.

Pastoral Society

A pastoral society is a social group whose economy is based on the raising and herding of livestock, often leading a nomadic or semi-nomadic lifestyle.

Glen Ridge Community

A reference to a specific community or neighborhood, potentially emphasizing its unique social, cultural, or demographic characteristics (Without specific context, this term is too broad for a precise definition).