The shareholders’ equity for Blade, Inc. on December 31, 2013, follows:

Shareholders’ Equity

Share Capital:

Common Shares, 100,000 shares authorized,

50,000 shares issued and outstanding.........$450,000

Total Share Capital................$450,000

Retained Earnings............... 120,000

Total Shareholders’ Equity..............$570,000

On April 30, 2014, the market price of Blade’s common shares was $16 per share and the company distributed a 10% stock dividend.

Requirements

1. Journalize the declaration and distribution of the stock dividend.

2. Prepare the shareholders’ equity section of the balance sheet after the stock dividend.