Lake Enterprises has both common and preferred stock. There are 50,000 shares of $4 par common stock outstanding and 1,000 shares of $25 par, 7% cumulative preferred stock outstanding. The company did not pay any dividends last year. On June 1 of this year, the Board of Directors voted to give a $3,500 cash dividend to stockholders of record by June 15. The dividend would be paid on July 1. a) Calculate the amount of the dividend to be paid to each class of shareholders. Preferred Common Current b) Prepare journal entries to record the declaration and payment of the dividends. Date Description Debit Credit June 1 July 1 > Next Question Gotta Have It, Inc. is considering giving a 50% stock dividend or a 1.5 to 1 stock split. What would be the effect of each option? Gotta Have It currently has $6 par common stock with 250,000 shares authorized, 90,000 shares issued and outstanding. a) Calculate the effect on authorized shares, outstanding shares and the par value under each scenario. Stock Dividend Stock Split Authorized Shares Outstanding Shares Par Value b) Prepare the required journal entries assuming stock is issued upon declaration. If no journal entry is required, enter that in the account space of the first line of the journal entry Stock Dividend: Date Description Debit Credit Stock Split: Date Description Debit Credit C) Taking the journal entries into account, how would the stockholder's Equity section look AFTER each option? Original Stock Dividend Common Stock 540,000 Stock Split Retained Earnings 350,000 Total Stockholder's Equity 890,000 Great Greeks, Inc. began business in January 2013. Prepare the required journal entries for the following transactions: a) Jan 1 Issued 80,000 shares of $0.50 par value common stock for $65,000 cash. Date Description Debit Credit Jan 1 Cash 65,000 Common Stock 40,000 Paid in Capital in Excess of Par Value 25,000 b) Jan 31 Record net income for the month of $10,000. Date Description Debit Credit Jan 31 Income Summary c) Feb 20 Declared a 9% stock dividend when the market rate was $3 per share to be distributed immediately. Description Debit Credit Date Feb 20 st