#1) The owners’ equity accounts for Trans World Internationalare shown here: Common stock ($1 par value) $ 85,000 Capitalsurplus 227,000 Retained earnings 750,000________________________________________________________________________________________________________________________________________________________________ Total owners’ equity $1,062,000________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Requirement 1: AssumeTrans World stock currently sells for $28 per share and a stockdividend of 20 percent is declared. (a) How many new shares will bedistributed? New shares issued (b) Show the new balance for eachequity account. Common stock $ Capital surplus Retained earnings________________________________________________________________________________________________________________________________________________________________ Total owners’ equity $________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ Requirement 2: Now assumethat instead Trans World declares a stock dividend of 24 percent.(a) How many new shares will be distributed? New shares issued (b)Show the new balance for each equity account. Common stock $Capital surplus Retained earnings________________________________________________________________________________________________________________________________________________________________ Total owners’ equity $________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________#2) The company with the common equity accounts shown here hasdeclared a 13 percent stock dividend at a time when the marketvalue of its stock is $43 per share. Common stock ($1 par value) $470,000 Capital surplus 1,555,000 Retained earnings 3,878,000________________________________________________________________________________ Total owners’ equity $5,903,000________________________________________________________________________________________________________________________________________________________________________________________________________ Required: Show the newequity account balances after the stock dividend distribution.Common stock $ Capital surplus Retained earnings________________________________________ Total owners’ equity $________________________________________________________________________________________________________________________