Question: On April 1 st , XYZ Co. declared a 10% stock dividend . Prior to the dividend, XYZ Co. has outstanding 30,000 shares of $10

  1. On April 1st, XYZ Co. declared a 10% stock dividend. Prior to the dividend, XYZ Co. has outstanding 30,000 shares of $10 par value common stock and a Retained Earnings account balance of $500,000. On April 1st, the market value of XYZ Co.s stock was $26 per share. The dividend was paid on April 15th. Prepare a journal entry for the following dates:
  1. April 1st
  2. April 15th
  3. What would be the new balance for Retained Earnings after the 10% stock dividend?
  4. What would be the total effect [dollar increase or decrease] in stockholders equity after the 10% stock dividend?

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