Question

On January 1, Concord Corporation had 113000 shares of $10 par value common stock outstanding. On March 17 the company declared a 5% stock dividend to stockholders of record on March 20. Market value of the stock was $15 on March 17. The entry to record the transaction of March 17 would include a

Answer 1

Answer and Explanation:

The Journal entry is shown below:-

March 17

Stock Dividend Dr, $84,750 (113,000 × 5% × $15)

To Common Stock Dividend Distributable $56,500 (113000 × 5% × $10)

To Paid in capital in excess of Par - Common Stock $28,250

(Being stock dividend is recorded)

Here we debited the stock dividend and we credited the Common Stock Dividend Distributable and Paid in capital in excess of Par - Common Stock