Question

help pls on T account and total stockholder equity!

In some cases, companies elect to pay dividends to stockholders in the form of additional shares cash. A stock dividend is normally declared only on common stock and issued to common stockholders, An analysis of Hydrangeas, Inc.'s common stock is as follows: 2001000 -17450 Nol'sht + Number of common shares 215,000 Atho 174,500 *0.04 = 6980 Shares authorized Roar shares issued 200,000 shares outstanding 174,500 On September 1, Hydrangeas, Inc. declared d 49 stock dividend for its common stockholders. The stock dividend will be distributed on October 13 for holders of records on October 1. Hydrangeas's common stock has a par value of $0.102 Complete the table to reflect the correct number of common shares in the company after the stock dividend is distribuated (Hint: Remember, the member of shares declared (and distributed) are calculated using outstanding shares because only onstandanding shares receive dividends.) Show any work you wish for me to consider for partial credit in this box: Number of common shares Shares authorized Shares issued 1215 1000 206 1980 181/480 Shares outstanding On September 1, the market price of Hydrangeas, Inc.'s common stock was $4.50 per share. On October 1, the market price of Hydrangeas. Inc.'s common stock was $4.75 per share. On October 13, the market price of Hydrangeas, Inc.'s common stock was $4.00 per share. Complete the necessary journal entries that Hydrangeas, Inc. made in order to account for the declaration and distribution of its stock dividend. 6980 ARANTil

Answer 1

1. Before Stock Dividend -

Shares Authorised Shares Issued Shares Outstanding Number of Common Shares 215,000 200,000 174,500

2. After Stock Dividend -

Shares Authorised Shares Issued Shares Outstanding Number of Common Shares 215,000 206,980 181,480

3. Balance before and after Stock Dividend -

Common Stock Paid in Capital in Excess of Par - Common Stock Retained Earnings Treasury Stock Total Balance before the Balance after the Stock Dividend Stock Dividend $ 20,000 $ 20,698 $ 580,000 $ 610,712 $ 3,000,000 $ 2,968,590 $ (79,050) $ (79,050) $ 3,520,950 $ 3,520,950

4. Journal Entries -

Credit Journal Entries Date Accounts Payable Debit Sept 1 Retained Earnings $ 31,410 Common Stock Dividend Distributable (Being Stock Dividend Declared) (174,500 Shares X 4% X $4.50 = $31,410) $ 31,410 Oct 13 Common Stock Dividend Distributable $ 31,410 Common Stock Paid in Capital in Excess of Par - Common Stock (Being Stock Dividend Distributed) $ $ 698 30,712

5. Ledgers -

Common Stock Beg Bal $ CS Dividend Distrib$ 20,000 698 PIC-CS Beg Bal $580,000 CS Dividend Distrib $ 30,712 Cl. Bal $ 20,698 Cl. Bal $ 610,712 Retained Earnings 31,410 Beg Bal Treasury Stock $ 79,050 CS Dividend Distrib$ $3,000,000 Beg Bal Bal $ 79,050 Cl. Bal $ 2,968,590 $ CS Dividend Distrib 698 Retained Earnings 30,712 Common Stock PIC-CS 31,410 $ $ $ 31,410 $ 31,410

6. Stockholder's Equity -

Hydrangeas, Inc. Stockholder's Equity Common Stock $ Paid in Capital in Excess of Par - Common Stock $ Retained Earnings $ (-) Treasury Stock $ 20,698 610,712 2,968,590 (79,050) Total Stockholder's Equity $ 3,520,950