The stockholders’ equity of Mountainside Occupational Therapy, Inc. on December 31, 2024, follows: 

On April 30, 2025, the market price of Mountainside Occupational Therapy, Inc.’s common stock was $11 per share and the company declared a 10% stock dividend. The stock was distributed on May 15. 

Requirements 

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

2. Prepare the stockholders’ equity section of the balance sheet as of May 31, 2025. Assume Retained Earnings are $121,000 on April 30, 2025, before the stock dividend, and the only change made to Retained Earnings before preparing the balance sheet was closing the Stock Dividends account.

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Stockholders' Equity Paid-In Capital: Common Stock-$1 Par Value; 1,250 shares authorized, 530 shares issued and outstanding Paid-In Capital in Excess of Par-Common Total Paid-In Capital Retained Earnings Total Stockholders' Equity $ 530 2,120 2,650 121,000 $ 123,650