The? stockholders' equity for

Heavenly DessertsHeavenly Desserts

?Drive-Ins

?(HDHD?)

on

JuneJune

1212?,

20152015?,

?follows:

Stockholders' Equity

Common Stock,$0.10 par, 2, 100,000 shares

authorized,700,000 issued $70,000

Paid-in Capital in excess of par-common 1,506,773

Retained earnings 7,100,000

Accumulated other comprehensive income(loss) (175,000)

Total stockholder's equity $ 8,501,773

On

JuneJune

1212?,

20152015?,

the market price of

HDHD

common stock was

$ 17$17

per share. Assume

HDHD

declared and distributed

aa

1212?%

stock dividend on this date.

1.	Journalize the declaration and distribution of the stock dividend.
2.	Prepare the? stockholders' equity section of the balance sheet after the stock dividend.
3.	Why is total? stockholders' equity unchanged by the stock? dividend?
4.	Suppose HDHD had a cash balance of $ 560 comma 000$560,000 on JuneJune1313?, 20152015. What is the maximum amount of cash dividends HDHD can? declare?