Question

Entries for Stock Dividends

Zurich Corporation has 25,000 shares of $20 par common stock outstanding. On June 8, Zurich Corporation declared a 5% stock dividend to be issued August 12 to stockholders of record on July 13. The market price of the stock was $24 per share on June 8.

Journalize the entries required on June 8, July 13, and August 12. For a compound transaction, if an amount box does not require an entry, leave it blank. If no entry is required, select "No Entry Required" and leave the amount boxes blank.

Jun. 8	Stock Dividends
	Stock Dividends Distributable
	Paid-In Capital in Excess of Par-Common Stock
Jul. 13	No Entry Required
	No Entry Required
Aug. 12	Stock Dividends Distributable
	Common Stock

Answer 1

Solution:

Journal Entries - Zurich Corporation
Date	Particulars	Debit	Credit
8-Jun	Stock dividends Dr (25000*5%*$24)	$30,000.00
	To Stock dividend distributable (25000*5%*$20)		$25,000.00
	To Paid in capital in excess of par - common stock		$5,000.00
	(To record stock dividend declared)
13-Jul	No Entry Required
	No Entry Required
12-Aug	Stock dividend distributable Dr	$25,000.00
	To Common stock		$25,000.00
	(To record issue of stock dividend)