Entries for Stock Dividends

Advanced Life Co. is an HMO for businesses in the Albuquerque area. The following account balances appear on the balance sheet of Advanced Life Co.: Common stock (340,000 shares authorized; 4,000 shares issued), $75 par, $300,000; Paid-in capital in excess of par common stock, $60,000; and Retained earnings, $3,000,000. The board of directors declared a 2% stock dividend when the market price of the stock was $101 a share. Advanced Life Co. reported no income or loss for the current year.

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a1. Journalize the entry to record the declaration of the dividend, capitalizing an amount equal to market value. If an amount box does not require an entry, leave it blank.

blank	CashPaid-In Capital in Excess of Par-Common StockRetained EarningsStock DividendsStock Dividends DistributableStock Dividends	Stock Dividends	Stock Dividends
	CashRetained EarningsStock DividendsStock Dividends DistributableTreasury StockStock Dividends Distributable	Stock Dividends Distributable	Stock Dividends Distributable
	CashCommon StockPaid-In Capital in Excess of Par-Common StockRetained EarningsStock DividendsPaid-In Capital in Excess of Par-Common Stock	Paid-In Capital in Excess of Par-Common Stock	Paid-In Capital in Excess of Par-Common Stock

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a2. Journalize the entry to record the issuance of the stock certificates. If an amount box does not require an entry, leave it blank.

blank	Common StockPaid-In Capital in Excess of Par-Common StockRetained EarningsStock DividendsStock Dividends DistributableStock Dividends Distributable	Stock Dividends Distributable	Stock Dividends Distributable
	Common StockPaid-In Capital in Excess of Par-Common StockRetained EarningsStock DividendsStock Dividends DistributableCommon Stock	Common Stock	Common Stock

Partially correct

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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	$fill in the blank a62b93fbffb1075_1
Total retained earnings	$fill in the blank a62b93fbffb1075_2
Total stockholders' equity	$fill in the blank a62b93fbffb1075_3

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	$fill in the blank a62b93fbffb1075_4
Total retained earnings	$fill in the blank a62b93fbffb1075_5
Total stockholders' equity	$fill in the blank a62b93fbffb1075_6

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