Question

The following data were taken from the balance sheet accounts of Sunland Corporation on December 31, 2016.

Current assets		$530,000
Debt investments		651,000
Common stock (par value $10)		502,000
Paid-in capital in excess of par		152,000
Retained earnings		826,000

Prepare the required journal entries for the following unrelated items. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

(a)		A 6% stock dividend is (1) declared and (2) distributed at a time when the market price per share is $34.
(b)		The par value of the common stock is reduced to $2 with a 5-for-1 stock split.
(c)		A dividend is declared January 5, 2017, and paid January 25, 2017, in bonds held as an investment. The bonds have a book value of $104,000 and a fair value of $124,000.

please show work (:

Answer 1

Answer
	Account Title	Debit	Credit
a	Retained Earnings	$      102,408		50200*6%*34
	Common Stock Dividend Distributable		$        30,120	50200*6%*10
	Paid-in Capital in Excess of Par - Common Stock		$        72,288
	Common Stock Dividend Distributable	$        30,120
	Common Stock		$        30,120
b	NO entry	$                -
	NO entry		$               -
c
Jan-05	Debt Investments	$        20,000		124000-104000
	Unrealized Holding Gain or Loss - Income		$        20,000
Jan-05	Retained Earnings	$      124,000
	Property Dividends Payable		$      124,000
Jan-25	Property Dividends Payable	$      124,000
	Debt Investments		$      124,000