Exerdise 11-16 at was issued at par and n January 1 2017 Sarasota Corp. ha ?1,25

Question

Exerdise 11-16 at was issued at par and n January 1 2017 Sarasota Corp. ha ?1,250 000 o cornmun s ock uu standin h re an ed earning s u $780 000. The company issued 40 000 shares o common stock at par un July 1 and earned net 'n ome of S447 000 r he year (Credit o Credit account titles are ? tomatical y inde ted when amount s entered. Do not dent m ?nually If no entry s required select "No oumalize the dec aration o a 16% stock dividend on December 10, 2017, for the following two ndependent assumptions Entry" for the account titles and enter 0 for the amounts.) (a) Par value is $10 and market price is $1 (b) Par value is $5 and market price is $8. No. Account Titles and Explanation Debit Credit

Explanation / Answer

a Retained earnings 448000 =(135000+40000)*16%*16        Common Stock 280000 =(135000+40000)*16%*10        Paid in capital in excess of par-Common Stock 168000 b Retained earnings 396800 =(270000+40000)*16%*8        Common Stock 248000 =(270000+40000)*16%*5        Paid in capital in excess of par-Common Stock 148800

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