The stockholders equity section of TVX Company on February 4 follows.

Common stock$5 par value, 150,000 shares authorized, 63,000 shares issued and outstanding	$ 315,000
Paid-in capital in excess of par value, common stock	422,000
Retained earnings	550,000
Total stockholders equity	$ 1,287,000

On February 5, the directors declare a 2% stock dividend distributable on February 28 to the February 15 stockholders of record. The stocks market value is $36 per share on February 5 before the stock dividend.

Exercise 11-10 (Algo) Part 1

1. Prepare entries to record both the dividend declaration and its distribution.