A corporation had 30,000 shares of $6 par value common stock outstanding

Accounting Nov 30, 2020

A corporation had 30,000 shares of $6 par value common stock outstanding. The board of directors declared and issued a 20% stock dividend. The market value of the stock was $34 per share. What is the journal entry to record this stock dividend? Multiple Choice Debit Retained Earnings and credit Common Stock for $204,000. Debit Retained Earnings for $204,000, credit Common Stock for $36,000, and credit Additional Paid-in Capital for $168,000. Debit Retained Earnings for $240,000, credit Common Stock for $36,000, and credit Additional Paid-in Capital for $204,000. Debit Retained Earnings and credit Common Stock for $36,000.

Expert Solution

ParticularsDebitCreditRetained Earnings$ 2,04,000.00(30000 x 20% x $ 34)To Common Stock$ 36,000.00(30000 x 20% x $ 6)To Additional Paid in Capital$ 1,68,000.00(30000 x 20% x $ 28)

Archived Solution

Unlocked Solution

You have full access to this solution. To save a copy with all formatting and attachments, use the button below.

Already a member? Sign In

Important Note: This solution is from our archive and has been purchased by others. Submitting it as-is may trigger plagiarism detection. Use it for reference only.

For ready-to-submit work, please order a fresh solution below.

Or get 100% fresh solution

Get Custom Quote