Question

Exercise 11-21 Your answer is partially correct. Try again. On January 1, 2022, Pronghorn Corp had $1,340,000 of common stock outstanding that was issued at par and retained earnings of $719,000. The company issued 31,000 shares of common stock at par on July 1 and earned net income of $406,000 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 o for the amounts.) (a) Par value is $10 and market price is $15. (b) Par value is $5 and market price is $8. No. Account Titles and Explanation Debit Credit (a) Stock Dividends 3496050 Common Stock Dividends Distributable 2330700 Paid-in Capital in Excess of Par Value-Common St 1165350 (b) Tstock Dividends 1 1864560 | Common Stock Dividends Distributable 116535 Paid-in Capital in Excess of Par Value-Common St 699210 Click if you would like to Show Work for this question: Open Show Work

Answer 1

Part a
Stock Dividend
No. of outstanding shares(134,000+31,000)	165000
Stock Dividend Percentage(%)	17%
No. of shares to be issued	28050
X Market value on dividend declaration	$15
Value of stock dividend	$4,20,750
Accounts and explanations	Debit	Credit
Stock Dividend	$4,20,750
Common stock-Dividend Distributable(28,050*$10)		$2,80,500
Paid in capital in excess of par-Common stock		$1,40,250
Part b
Stock Dividend
No. of outstanding shares	299000
Stock Dividend Percentage(%)	17%
No. of shares to be issued	50830
X Market value on dividend declaration	$8
Value of stock dividend	$4,06,640
Accounts and explanations	Debit	Credit
Stock Dividend	$4,06,640
Common stock-Dividend Distributable(50,830*$5)		$2,54,150
Paid in capital in excess of par-Common stock		$1,52,490