he stockholders equity of TVX Company at the beginning of the day on February 5 follows.

Common stock$20 par value, 150,000 shares authorized, 60,000 shares issued and outstanding	$	1,200,000
Paid-in capital in excess of par value, common stock		424,000
Retained earnings		546,000
Total stockholders equity	$	2,170,000

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.

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

a. Record the declaration of a 2% stock dividend on February 5th and February 28th.

2. Prepare the stockholders' equity section after the stock dividend is distributed. (Assume no other changes to equity.)

TVX COMPANY
Stockholders Equity Section of the Balance Sheet
February 28
Total stockholders equity