The shareholders' equity for Pondwood, Inc. on December 31, 2014, follows: Shareholders' Equity Share Capital: Common Shares,

Question:

The shareholders' equity for Pondwood, Inc. on December 31, 2014, follows:

Shareholders' Equity

Share Capital:

Common Shares, 350,000 shares authorized,

40,000 issued and outstanding ......................................$200,000

Total Share Capital ......................................................200,000

Retained Earnings ......................................................360,000

Total Shareholders' Equity ..........................................$560,000

On September 30, 2015, the market price of Pondwood's common shares was $11 per share and the company distributed a 30% stock dividend.

Requirements

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

2. Prepare the shareholders' equity section of the Pondwood, Inc. statement of financial position after the stock dividend.

Distribution
The word "distribution" has several meanings in the financial world, most of them pertaining to the payment of assets from a fund, account, or individual security to an investor or beneficiary. Retirement account distributions are among the most...
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Related Book For  book-img-for-question

Financial Accounting

ISBN: 978-0133375534

2nd Canadian edition

Authors: Jeffrey Waybright, Robert Kemp, Sherif Elbarrad

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