Exercise 11-6 Stock dividends and per share book values LO P2

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The stockholders equity of TVX Company at the beginning of the day on February 5 follows:

Common stock$20 par value, 150,000 shares authorized, 60,000 shares issued and outstanding $ 1,200,000 Paid-in capital in excess of par value, common stock 525,000 Retained earnings 675,000 Total stockholders equity $ 2,400,000

On February 5, the directors declare a 10% stock dividend distributable on February 28 to the February 15 stockholders of record. The stocks market value is $39 per share on February 5 before the stock dividend. The stocks market value is $35 per share on February 28.

Exercise 11-6 Part 1 1. Prepare entries to record both the dividend declaration and its distribution.