Therefore, Since the declared stock dividends is large, the treatment shall be recorded at PAR VALUE. Therefore the market value is ignored. Par value =1200000 share capital + 120000 shares = 10 par value The shares outstanding at this point is Beginning 120000 Less: Acquisition of own shares 5000 Add; Reissuance of own shares 2000 Outstanding shares before stock dividends 1 17000 The declared share dividends is =117000*30%*10 351000 6. to record for the distribution of stock dividend, we have to reverse the stock dividend payable and credit to common stock. Note that distribution of stock dividends don't have effect in the total shareholders equity. 7. for a stock split, you only have to create a memo entry stating that par value per share has changed due to implementation of a stock split. 2-for-1 split means that you will divide the par value of share into 2 and multiply outstanding shares by 2. 8. Ultimately, the net income / loss is closed to retained earnings. as it is a nominal account {temporary account]. Net income increases the retained earnings while net loss decreases retained earnings