On January 1, 2019, Frederick Corporation had 200,000 shares of common stock outstanding with a par value of $5 per share. On March 31, Frederick Corporation authorized a 10% stock dividend when the market value was $18 per share.

Required:

1. Use this information to prepare the General Journal entry (without explanation) for March 31. If no entry is required then write "No Entry Required."

Question

Business

Ulises Sosa

30 June, 18:11

On January 1, 2019, Frederick Corporation had 200,000 shares of common stock outstanding with a par value of $5 per share. On March 31, Frederick Corporation authorized a 10% stock dividend when the market value was $18 per share.

Required:

1. Use this information to prepare the General Journal entry (without explanation) for March 31. If no entry is required then write "No Entry Required."

+2

Answers (1)

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Charity · Answer 1

Dividend (debit) $100,000

Shareholders for Dividends (credit) $100,000

Explanation:

Recognize a Statement of Changes in Equity Item - Dividend and also Recognize the Liability - Shareholders for Dividends that arises as a result of the authorization.

Journal

Dividend (debit) $100,000

Shareholders for Dividends (credit) $100,000

Dividend Calculation:

Dividend Distribution = 200,000 shares * $5 per share * 10%

= $100,000