On January 1, 2016, Alpha Corporation had 300,000 shares of common stock outstanding with a par value of $3 per share. On March 31, Alpha Corporation declared a 10% stock dividend when the market value was $8 per share. Use this information to prepare the General Journal entry (without explanation) for March 31. If no entry is required then write "No Entry Required."

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Business

Lane Irwin

Today, 05:39

On January 1, 2016, Alpha Corporation had 300,000 shares of common stock outstanding with a par value of $3 per share. On March 31, Alpha Corporation declared a 10% stock dividend when the market value was $8 per share. Use this information to prepare the General Journal entry (without explanation) for March 31. If no entry is required then write "No Entry Required."

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Karley Dorsey · Answer 1

The journal entry is shown below:

Retained earning A/c Dr $240,000

To Common Stock A/c $90,000

To Paid-in Capital in excess of Par-Common stock $150,000

(Being the dividend is recorded)

The computation is shown below

For common stock

= 300,000 shares * $3 * 10%

= $90,000

For retained earning

= 300,000 shares * $8 * 10%

= $240,000

And, the remaining balance is credited to the paid-in capital