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    Dividend Entries for Masefield Corporation

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    (Dividend Entries) The following data were taken from the balance sheet accounts of Masefield Corporation on December 31, 2007.

    Current Assets $540,000
    Investments $624,000
    Common Stock (par value $10) $500,000
    Paid in Capital in excess of par $150,000
    Retained Earnings $840,000

    Instructions

    Prepare the required journal entries for the following unrelated items.
    a.) A 5% stock dividend is declared and distributed at a time when the market value of the shares is $39 per share.
    b.) The par value of the capital stock is reduced to $2 with a 5-for-1 stock split.
    c.) A dividend is declared January 5, 2008, and paid January 25, 2008 in bonds held as an investment. The bonds have a book value of $100,000 and a fair market value of $135,000.

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    Solution Summary

    (Dividend Entries) The following data were taken from the balance sheet accounts of Masefield Corporation on December 31, 2007.

    Current Assets $540,000
    Investments $624,000
    Common Stock (par value $10) $500,000
    Paid in Capital in excess of par $150,000
    Retained Earnings $840,000

    Instructions

    Prepare the required journal entries for the following unrelated items.
    a.) A 5% stock dividend is declared and distributed at a time when the market value of the shares is $39 per share.
    b.) The par value of the capital stock is reduced to $2 with a 5-for-1 stock split.
    c.) A dividend is declared January 5, 2008, and paid January 25, 2008 in bonds held as an investment. The bonds have a book value of $100,000 and a fair market value of $135,000.

    $2.49

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