waveside pool supply has 16,000 shares of $3 par common stock outsdanding. waves
ID: 2421692 • Letter: W
Question
waveside pool supply has 16,000 shares of $3 par common stock outsdanding. waveside distrubutes a 10% stock dividend when the market value of its stock is $15 per share.
journalize waveside distribution of the stock dividend on july31
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Expert Answer
Anonymous answered this 17 minutes later
$ 19,200.00
what is the overall effect of the stock dividend on WS's total assets?
what is the overall effect on total stockholders equity?
Date Account titles Debit $ Credit $ 31-7-15 Retained earnings $ 24,000.00 Common stock $ 4,800.00 Paid in capital - excess of par$ 19,200.00
Explanation / Answer
Date Accounts Title Debit Credit
_________________________________________________________________________________________________
31.07.2015 Retained Earnings $300000
To Stock Dividend Distributable $300000
31.07.2015 Stock Dividend Distributable $300000
To Common Stock $200000
To Additional Paid-in Capital $100000
When Waveside pool Co. pays stock dividend, company is buying additional shares of stock and giving them to the shareholders. The cost of shares will come out of Retained Earnings and will add to Stockholder's Equity. So in the Balancesheet, total asset will remain the same.
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