Lake Company reported the following summarized balance sheet data as of December 31, 20X2:

Lake Company issues 4,000 additional shares of its \(\$ 10\) par value stock to its shareholders as a stock dividend on April 20, 20X3. The market price of Lake Company's shares at the time of the stock dividend is \(\$ 40\). Lake Company reports net income of \(\$ 25,000\) and pays a \(\$ 10,000\) cash dividend in 20X3. Lindale Company purchased 70 percent of the common shares of Lake Company at underlying book value on January 1, 20X1, and uses the basic equity method in accounting for its investment in Lake Company.
\section*{Required}

a. Give the journal entries recorded by Lake Company and Lindale Company at the time the stock dividend is declared and distributed.

b. Give the workpaper elimination entries needed to prepare consolidated financial statements for \(20 \times 3\).

c. Give the workpaper elimination entry needed to prepare a consolidated balance sheet on January \(1,20 \times 4\).

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Cash $ 30,000 Accounts Receivable 80.000 Accounts Payable Common Stock $ 50,000 100,000 Inventory 90.000 Retained Earnings 200,000 Buildings and Equipment 270.000 Less: Accumulated Depreciation (120.000) Total Assets $350.000 Total Liabilities and Equities $350,000