Exercise 13-10 (Algo) Small stock dividend LO P2

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The stockholders equity section of TVX Company on February 4 follows.

Common stock$15 par value, 150,000 shares authorized, 56,000 shares issued and outstanding	$ 840,000
Paid-in capital in excess of par value, common stock	421,000
Retained earnings	546,000
Total stockholders equity	$ 1,807,000

On February 5, the directors declare a 2% stock dividend distributable on February 28 to the February 15 stockholders of record. The stocks market value is $36 per share on February 5 before the stock dividend.

Exercise 13-10 (Algo) Part 1

1. Prepare entries to record both the dividend declaration and its distribution.

Journal Entry

Record the declaration of a 2% stock dividend.

Record the distribution of a 2% stock dividend.