Problem 10-05

Jackson Enterprises has the following capital (equity) accounts:

Common stock ($1 par; 250,000 shares outstanding)	$	250,000
Additional paid-in capital		350,000
Retained earnings		300,000

The board of directors has declared a 25 percent stock dividend on January 1 and a $0.25 cash dividend on March 1. What changes occur in the capital accounts after each transaction if the price of the stock is $3? Round the number of shares outstanding to the nearest whole number and the other answers to the nearest dollar.

The impact of the 25 percent stock dividend:

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

The impact of the $0.25 a share cash dividend:

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