Question

Heidi owns 400 shares of Boyd Enterprises stock, which is valued at $17 a share. Boyd Enterprises just declared a 10 percent stock dividend. How many shares will Heidi own and what will the price per share be after the dividend?

Answer 1

Answer:

After stock dividend, Heidi will own 440 shares at a price of $15.45 per share.

Explanation:

Heidi owns 400 shares.

The price of these shares is $17/per share.

The firm announces a 10% stock dividend.

The number of shares owned after dividend

=Current shares+10% of current shares

=400+10% of 400

=400+40 shares

=440 shares

Price per share after dividend

=Current value of shares/ number of shares after stock dividend

=$\frac{400*17}{440}$

=$\frac{6800}{440}$

=$15.45