Explain how to calculate the after the stock dividend for the below problem. At the beginning of the year, the stockholders' equity section of the balance sheet of Solutions Corporation reflected the following: On February 1, the board of directors declared a 60 percent stock dividend to be issued April 30. The market value of the stock on February 1 was $15 per share. The market value of the stock on April 30 was $18 per share. For comparative purposes, prepare the Stockholders’ Equity section of the balance sheet immediately before the stock dividend and immediately after the stock dividend.             Before Stock Dividend After Stock Dividend Contributed capital:     Common stock $360,000   Additional paid-in capital 120,000   Retained earnings 580,000   Total stockholders’ equity $1,060,000 $0

Question

Explain how to calculate the after the stock dividend for the below problem.

At the beginning of the year, the stockholders' equity section of the balance sheet of Solutions Corporation reflected the following:

On February 1, the board of directors declared a 60 percent stock dividend to be issued April 30. The market value of the stock on February 1 was $15 per share. The market value of the stock on April 30 was $18 per share.

For comparative purposes, prepare the Stockholders’ Equity section of the balance sheet immediately before the stock dividend and immediately after the stock dividend.

 
 
 
 
 
  Before Stock Dividend After Stock Dividend
Contributed capital:    
Common stock $360,000  
Additional paid-in capital 120,000  
Retained earnings 580,000  
Total stockholders’ equity $1,060,000 $0
 
 

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