Accounting for stock dividends (Learning Objectives 5 & 7) 10–15 min.

The stockholders’ equity for Shamrock, Inc., on December 31, 2013, follows:

Paid-in Capital:

Common Stock, $10 par, 900,000 shares authorized, 25,000 issued and outstanding Paid-in Capital in Excess of Par Total Paid-in Capital Retained Earnings Total Stockholders’ Equity

$250,000 160,000 410,000 175,000

$585,000 Stockholders’ Equity On August 31, 2014, the market price of Shamrock, Inc.’s common stock was $21 per share and the company distributed a 15% stock dividend.

Requirements 1. Journalize the declaration and distribution of the stock dividend.

2. Prepare the stockholders’ equity section of the balance sheet after the stock dividend.

AppendixLO1