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question E11-!B

Fll-15A. Large Stock Dividend and Forward Stock Split Low Corporation has 50,000 shares of $20 par value conmon stock outstanding and retained earnings of $750.000. The company declares a 1oo percent stock dividend. The market price at the declaration date is $20 per share d. Prepare the journal entries for (1) the declaration of the dividend and (2) the issuance of tihe dividend. b. Assume that the company splits its stock 2-for-1 and reduces the par value from $20 to Si0 rather than declaring a 100 percent stock dividend. How does the accounting for the forward stock split differ from the accounting for the 100 percent stock dividend? EB EXERCISES-SET B E11-IB. Dividend Distribution Bower Corporation has the following shares outstanding: 15,000 shares of $50 par value, cight percent preferred stock and 50,000 shares of $5 par value common stock During its first three years in business, the firm declared no dividends in the first year, $280,000 of dividends in the second year, and $60,000 of dividends in the third year a. If the preferred stock is cumulative, determine the total amount of dividends paid to each class of stock in each of the three years. b. If the preferred stock is noncumulative, determine the total amount of dividends paid to each class of stock in each of the three years