Stock Dividend Comparison

Although Oriole Company has enough retained earnings legally to declare a dividend, its working capital is low. The board of directors is considering a stock dividend instead of a cash dividend. The common stock is currently selling at $35 per share. The following is Oriole's current shareholders' equity:

Common stock, $10 par	$400,000
Additional paid-in capital on common stock	800,000
Total contributed capital	$1,200,000
Retained earnings	1,300,000
Total shareholders' equity	$2,500,000

1. Assuming a 15% stock dividend is declared and issued, prepare the shareholders' equity section immediately after the date of issuance.

Oriole Company
Stockholders' Equity
Common stock, $10 par
Additional paid-in capital on common stock
Total contributed capital
Retained earnings
Total shareholders' equity	$fill in the blank 5c9a3ef54ff2018_5

2.Assuming, instead, that a 30% stock dividend is declared and issued, prepare the shareholders' equity section immediately after the date of issuance.

Oriole Company
Shareholders' Equity
Common stock, $10 par
Additional paid-in capital on common stock
Total contributed capital