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Entries for Stock Dividends and Stock Splits

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The stockholders equity accounts of Lawrence Company have the following balances on December 31, 2010.
Common stock $10 par 200,000 shares issued and outstanding $2,000,000.
Paid-in Capital in excess of par $1,200,000.
Retained Earnings $5,600,000.
Shares of Lawrence Company stock are selling for $37.00 on the stock exchange.
Prepare the appropriate journal entry for the following cases:
A stock dividend of 5% is declared and issued.
A stock dividend of 100% is declared and issued.
A 2 for1 stock split is declared and issued

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The "rule" and the JEs are given for you.

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For stock dividends, the reclass from RE to paid in capital accounts ...

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Carol Sargent, PhD
Education
  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
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