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College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
Publisher: Cengage Learning,
ISBN: 9781337794756

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BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
Publisher: Cengage Learning,
ISBN: 9781337794756
Chapter 21, Problem 2MC
Textbook Problem
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When a stock dividend is declared, the journal entry will include a credit to

(a) Retained Earnings.

(b) Stock Dividends Distributable.

(c) Stock Dividends Payable.

(d) Stock Dividends Declared.

To determine

Find the correct option, the option that indicates the correct credit account for the given transaction.

Explanation of Solution

Stock dividends: Stock dividends are the number of shares issued by a company to the existing shareholders in a proportion equal to the number of shares owned by each shareholder, based on a stock dividend percentage.

Justification for correct answer: When the stock dividends are declared, the following journal entry is recorded:

DateAccount Titles and ExplanationPost Ref.Debit ($)Credit ($)
  Stock Dividends   
   Stock Dividends Distributable   
   ...

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Chapter 21 Solutions

College Accounting, Chapters 1-27
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Ch. 21 - Ozit Company made four quarterly income tax...Ch. 21 - DWP Company had net income of 183,000 and paid...Ch. 21 - Teway Company declared and paid dividends in the...Ch. 21 - On September 30, Polmax Power Companys board of...Ch. 21 - On January 1, 20--, MC Company had a retained...Ch. 21 - What expense do corporations incur that sole...Ch. 21 - What are the two major sources of capital for...Ch. 21 - For what reason do corporations retain earnings in...Ch. 21 - How do the procedures for closing Income Summary...Ch. 21 - What are the three dates involved in the...Ch. 21 - What is the effect of a cash dividend on the...Ch. 21 - Give three reasons why a corporation may...Ch. 21 - Where should stock dividends distributable be...Ch. 21 - What effect does a stock dividend have on the...Ch. 21 - What is the primary reason for appropriating...Ch. 21 - How are appropriated and unappropriated retained...Ch. 21 - CORPORATE INCOME TAX Stanton Company estimates...Ch. 21 - CLOSING INCOME SUMMARY AND DIVIDENDS TO RETAINED...Ch. 21 - COMMON AND PREFERRED CASH DIVIDENDS Wang Company...Ch. 21 - STOCK DIVIDENDS Kaufman Company currently has...Ch. 21 - STOCK SPLIT Goldstein Company has 100,000 shares...Ch. 21 - RETAINED EARNINGS APPROPRIATION On October 2,...Ch. 21 - STATEMENT OF RETAINED EARNINGS McGregor Company...Ch. 21 - CASH DIVIDENDS AND INCOME TAXES During the year...Ch. 21 - CASH DIVIDENDS, STOCK DIVIDEND, AND STOCK SPLIT...Ch. 21 - CASH DIVIDEND AND APPROPRIATION OF RETAINED...Ch. 21 - RETAINED EARNINGS ACCOUNTS AND STATEMENT On...Ch. 21 - CORPORATE INCOME TAX Regis Company estimates that...Ch. 21 - CLOSING INCOME SUMMARY AND DIVIDENDS TO RETAINED...Ch. 21 - COMMON AND PREFERRED CASH DIVIDENDS Ramirez...Ch. 21 - STOCK DIVIDENDS Martinez Company currently has...Ch. 21 - STOCK SPLIT Rogerson Company has 40,000 shares of...Ch. 21 - RETAINED EARNINGS APPROPRIATION On October 2,...Ch. 21 - STATEMENT OF RETAINED EARNINGS Womack Company had...Ch. 21 - CASH DIVIDENDS AND INCOME TAXES During the year...Ch. 21 - CASH DIVIDENDS, STOCK DIVIDEND, AND STOCK SPLIT...Ch. 21 - CASH DI VIDEND AND APPROPRI ATION OF RET AINED...Ch. 21 - RETAINED EARNINGS ACCOUNTS AND STATEMENT On...Ch. 21 - MANAGING YOUR WRITING The investments committee of...Ch. 21 - ETHICS CASE Richard Petri is the chief financial...Ch. 21 - MASTRY PROBLEM On January 1, 20--, Dover Companys...Ch. 21 - CHALLENGE PROBLEM This problem challenges you to...

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