Question

Entries for Stock Dividends Healthy Life Co. is an HMO for businesses in the Fresno area. The following account balances appear on Healthy Life's balance sheet: Common stock (230,000 shares authorized ; 8,000 shares issued), $125 par, $1,000,000; Paid-In Capital in excess of par-common stock, $200,000; and Retained earnings, $12,000,000. The board of directors declared a 1% stock dividend when the market price of the stock was $161 a share. Healthy Life reported no income or loss for the current year. If an amount box does not require an entry, leave it blank. If no entry is required, select "No entry required from the dropdown al. Journalize the entry to record the declaration of the dividend, capitalizing an amount equal to market value. a 2. Journalize the entry to record the issuance of the stock certificates. b. Determine the following amounts before the stock dividend was declared: (1) total paid-in capital, (2) total retained earnings, and (3) total stockholders' equity. Total paid-in capital Total retained earnings $L Total stockholders' equity $ c. Determine the following amounts after the stock dividend was declared and closing entries were recorded at the end of the year: (1) total paid-in capital, (2) total retained earnings, and (3) total stockholders' equity. Total paid-in capital s Total retained earnings $ Total stockholders' equity $

Answer 1

a1
Stock Dividends	12880		=8000*1%*161
Stock Dividends Distributable		10000	=8000*1%*125
Paid in Capital in excess of Par-Common Stock		2880
a2
Stock Dividends Distributable	10000
Common Stock		10000
b
Total paid-in Capital	1200000		=1000000+200000
Total retained earnings	12000000
Total stockholders' Equity	13200000
c
Total paid-in Capital	1212880		=1200000+12880
Total retained earnings	11987120		=12000000-12880
Total stockholders' Equity	13200000