Question

Madrid Corporation has 15,000 shares of $70 par common stock outstanding. On June 8, Madrid Corporation declared a 3% stock dividend to be issued August 12 to stockholders of record on July 13. The market price of the stock was $103 per share on June 8.

Journalize the entries required on June 8, July 13, and August 12. For a compound transaction, if an amount box does not require an entry, leave it blank. If no entry is required, select "No Entry Required" and leave the amount boxes blank.

Answer 1

Date	General Journal	Debit	Credit
June 8	Stock Dividends                                                                           [15,000 x 3% x $103]	$46,350
	Stock Dividends Distributable                                              [15,000 x 3% x $70]		$31,500
	Paid In Capital in excess of Par – Common Stock               [15,000 x 3% x ($103 - $70)]		$14,850
	(To record stock dividend declared)
July 13	No Entry Required
August 12	Stock Dividends Distributable	$31,500
	Common Stock		$31,500
	(To record issue of stock dividend)