Global Corporation had 55,000 shares of $20 par value common stock outstanding on July 1. Later that day the board of directors declared a 10% stock dividend when the market value of each share was $25. The entry to record this dividend is:

No entry is made until the stock is issued.

Debit Retained Earnings $110,000; credit Common Stock Dividend Distributable $110,000.

Debit Retained Earnings $137,500; credit Common Stock Dividend Distributable $110,000; credit Paid-In Capital in Excess of Par Value, Common Stock $27,500.

Debit Retained Earnings $137,500; credit Common Stock Dividend Distributable $137,500.

Debit Retained Earnings $137,500; credit Cash $137,500.