Problem 10-05

Jackson Enterprises has the following capital (equity) accounts:

Common stock ($1 par; 100,000 shares outstanding)$100,000Additional paid-in capital250,000Retained earnings275,000

The board of directors has declared a 15 percent stock dividend on January 1 and a $0.15 cash dividend on March 1. What changes occur in the capital accounts after each transaction if the price of the stock is $5? Round the number of shares outstanding to the nearest whole number and the other answers to the nearest dollar.

The impact of the 15 percent stock dividend:

Common stock ($par;shares outstanding)$Additional paid-in capital$Retained earnings$The impact of the $0.15 a share cash dividend:

Common stock ($par;shares outstanding)$Additional paid-in capital$Retained earnings$