Question
Luther Lumber Corporation has 1,000,000 shares of common stock authorized, of which 550,000 shares are issued and outstanding. The common stock has a $10 par
Luther Lumber Corporation has 1,000,000 shares of common stock authorized, of which 550,000 shares are issued and outstanding. The common stock has a $10 par value, a $12 book value, and a $13 market value when the corporation declared a 10% stock dividend. What journal entry is required on that date?
a. None.
b. Retained Earnings 550,000
Dividends Payable 550,000
c. Retained Earnings 660,000
Stock Dividend Distributable 550,000
Paid-in Capital in Excess of Par Value 110,000
d. Retained Earnings 715,000
Stock Dividend Distributable 550,000
Paid-in Capital in Excess of Par Value 165,000
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