Question

On January 1, 2022, Monty Corp. had $1,160,000 of common stock outstanding that was issued at par and retained earnings of $811,000. The company issued 38,000 shares of common stock at par on July 1 and earned net income of $495,000 for the year.

Journalize the declaration of a 17% stock dividend on December 10, 2022, for the following two independent assumptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

(a)		Par value is $10 and market price is $18.
(b)		Par value is $5 and market price is $8.

Answer 1

Solutioll Given that solution Date particulary Debit (8) enedit (8) 471240 (10. Dec 2022 stock Dividends Common stock dividende distributable paid in capital in I excey distribuitable 261800 209440 Calculation Quen On the Question. Monty Corp - $1,160,000 pea value = Śro The company issue - $38,000 shares Total shang = (1, 160,000 ) +38000 ( 10 116,000 438000 : 154,000 Woating Note:- stoce dividends - 154,000 X47% X18 471,240 Common stocke dividends distributable = 154000X17%X10 261800 paid Pin capital Pin excess : fof par value : 154000x14%(18-10) • 209440

. (6) Date 10-Dec 2022 Credit Debit 367200 I particulars stocke dividends Common stock diidends distaibutable paid in capital in Excery of par value 229500 137700 Calculations! - Total shang = 1160000 +38000 5 270000 worstelling Notes stock dividends - 370000 x 18%, x8 :: 367200 common stock didends distaibutable = 240000 x 17%x5 = 229500 paid in capital or excess of page value. 270000X14%*(8-5)'. : 137700