The stockholders equity section of Pillar Corporations comparative balance sheet at the end of 2013 and 2014 is presented below. It is part of the financial data just reviewed at a stockholders meeting.

	December 31, 2014	December 31, 2013
Common Stock, $10 Par Value, 600,000 shares
authorized; issued at
December 31, 2014, 275,000 shares;
2013, 250,000 shares .....................	$2,750,000	2,500,000
Paid-in Capital in Excess of Par...............	4,575,000	4,125,000
Retained Earnings (see Note).................	2,960,000	2,825,000
Total Stockholders Equity ...................	$10,285,000	$9,450,000

Note: Availability of retained earnings for cash dividends is restricted by $2,000,000 due to a planned plant expansion.

The following items were also disclosed at the stockholders meeting: net income for 2014 was $1,220,000; a 10% stock dividend was issued December 14, 2014; when the stock dividend was declared, the market value was $28 per share; the market value per share at December 31, 2014, was $26; management plans to borrow $500,000 to help finance a new plant addition, which is expected to cost a total of $2,300,000; and the customary $1.54 per share cash dividend had been revised to $1.40 when declared and issued the last week of December 2014. As part of its investor relations program, during the stockholders meeting management asked stockholders to write any questions they might have concerning the firms operations or finances. As assistant controller, you are given the stockholders questions.

I heard someone say that stock dividends dont give me anything I didnt already have. Why did you issue one? Are you trying to fool us?