Question

E CHAPTER 14 ASSIGNMENT - / 1 III Question 35 of 50 On October 10, the board of directors of Pinto Corporation declared a 10% stock dividend. On October 10, the company had 10,000 shares of $1 par common stock issued and outstanding with a market price of $16 per share. The stock dividend will be distributed on October 31 to shareholders of record on October 25. Journalize the entries needed for the declaration and distribution of the stock dividend. (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 for the amounts.) Debit Credit Date Account Titles and Explanation Oct. 10 Oct. 31 e Textbook and Media xi w] V 18 o hp

Answer 1

Solution:

Below are the journal entries for declaration and distribution of stock dividend:

Date Account title and explanation 10-Oct Stock dividend Common Stock Dividend Distributable Paid-in Capital in Excess of Par-Common Stock Debit Credit Calculation $16,000 (10,000 shares * 10% * $16) $1,000 (10,000 shares * 10% * $1) $15,000 ($16,000 - $1,000) $1,000 31-Oct Common Stock Dividend Distributable Common Stock $1,000