The stockholders’ equity section of TVX Company on February 4 follows. Common stock—$10 par value, 150,000 shares authorized, 60,000 shares issued and outstanding $ 600,000 P2 Paid-in capital in excess of par value, common stock . 425,000 Retained earnings 550,000 Total stockholders’ equity . $1,575,000 On February 5, the directors declare a 20% stock dividend distributable on February 28 to the February 15 stockholders of record. The stock’s market value is $40 per share on February 5 before the stock dividend. 1. Prepare entries to record both the dividend declaration and its distribution. 2. Prepare the stockholders’ equity section after the stock dividend is distributed. (Assume no other changes to equity.)
The stockholders’ equity section of TVX Company on February 4 follows. Common stock—$10 par value, 150,000 shares authorized, 60,000 shares issued and outstanding $ 600,000 P2 Paid-in capital in excess of par value, common stock . 425,000 Retained earnings 550,000 Total stockholders’ equity . $1,575,000 On February 5, the directors declare a 20% stock dividend distributable on February 28 to the February 15 stockholders of record. The stock’s market value is $40 per share on February 5 before the stock dividend. 1. Prepare entries to record both the dividend declaration and its distribution. 2. Prepare the stockholders’ equity section after the stock dividend is distributed. (Assume no other changes to equity.)
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter20: Corporations: Organization And Capital Stock
Section: Chapter Questions
Problem 5SEB: STOCKHOLDERS EQUITY SECTION After closing its books on December 31, Mel Brothers stockholders equity...
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100%
The
Paid-in capital in excess of par value, common stock . 425,000
Retained earnings 550,000
Total stockholders’ equity . $1,575,000
On February 5, the directors declare a 20% stock dividend distributable on February 28 to the February 15
stockholders of record. The stock’s market value is $40 per share on February 5 before the stock dividend.
1. Prepare entries to record both the dividend declaration and its distribution.
2. Prepare the stockholders’ equity section after the stock dividend is distributed. (Assume no other
changes to equity.)
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