value: 5.00 points Company Z has 2.05 million shares of common stock authorized

Question

value: 5.00 points Company Z has 2.05 million shares of common stock authorized with a par value of $1 and a market price of $51. There are 1.025 million outstanding shares and 0.25625 million shares held in treasury stock. Prepare the journal entry if the company declares and distributes a 10% stock dividend. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Enter your answers in dollars and not in millions.) a. View transaction list Journal entry worksheet Record the declaration and distribution of the 10% stock dividend Note: Enter debits before credits Transaction General Journal Debit Credit etained Earnings Common Stock 102,500 Additional Paid-in Capital Record entry Clear entry Viow general journel

Explanation / Answer

Calculation of stock dividend Journal entry to record declaration and distribution of stock dividend Effects of the 10% stock dividend on assets,liabilities and stockholders equity Stock Dividend Transaction General Journal Debit Credit Assets = Liabilities + Stockholders Equity Number of outstanding shares less treasury stock 768750 1 Retained Earnings $3,920,625 Retained Earnings $3,920,625 Stock Dividend Percentage 10% Common stock $76,875 Common stock $76,875 Number of shares to be issued 76875 Additional Paid in capital - excess of par $3,843,750 Additional Paid in capital $3,843,750 Market price per share $51 (recording of distribution of 10% stock dividend) Value of Stock Dividend $3,920,625 Calculation of stock dividend Journal entry to record declaration and distribution of stock dividend Effects of the 100% stock dividend on assets,liabilities and stockholders equity Stock Dividend Transaction General Journal Debit Credit Assets = Liabilities + Stockholders Equity Number of outstanding shares less treasury stock 768750 1 Retained Earnings $768,750 Retained Earnings $768,750 Stock Dividend Percentage 100% Common stock $768,750 Common stock $768,750 Number of shares to be issued 768750 Par value per share $1 (recording of distribution of 10% stock dividend) Value of Stock Dividend $768,750

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