Question

The stockholders’ equity accounts of Flint Company have the following balances on December 31, 2020. Common stock, $10 par, 292,000 shares issued and outstanding $2,920,000 Paid-in capital in excess of par—common stock 1,320,000 Retained earnings 5,080,000 Shares of Flint Company stock are currently selling on the Midwest Stock Exchange at $33. Prepare the appropriate journal entries for each of the following cases. (Credit account titles are automatically indented when amount is entered.

(a)		A stock dividend of 6% is (1) declared and (2) issued.
(b)		A stock dividend of 100% is (1) declared and (2) issued.
(c)		A 2-for-1 stock split is (1) declared and (2) issued.

Answer 1

No.	Account Titles and Explanation	Debit	Credit
(a) (1)	Retained Earnings	578,160		(292,000 x 6% x $33)
	Common Stock Dividend Distributable		175,200	(292,000 x 6% x $10)
	Paid-in Capital in Excess of Par-Common Stock		402,960	balance
(a) (2)	Common Stock Dividend Distributable	175,200
	Common Stock		175,200
(b) (1)	Retained Earnings	2,920,000
	Common Stock Dividend Distributable		2,920,000
(b) (2)	Common Stock Dividend Distributable	2,920,000
	Common Stock		2,920,000
(c) (1)	No Entry Required	-
(c) (2)	No Entry Required