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Nash Corporation has outstanding 343,000 shares of $10 par value common stock. The corporation declares a 10% stock dividend when the fair value of the stock is $64 per share. Prepare the journal entries for Nash Corporation for both the date of declaration and the date of distribution. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

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Answer:

Date of Declaration

Debit Retained earnings $2,195,200

Credit Paid in capital in Excess of par $1,852,200

Common Stock Dividend Distributable $343,000

Date of Distribution

Debit Common Stock dividend Distributable $343,000

Credit Common Stock #343,000

Explanation:

The question is prepare the journal entries for Nash Corporation

a) for date of declaration

b) Date of Distribution

a) date of declaration

Description                                                    Debit                            Credit

Declaration Date

Retained Earnings   343,000x 0.1 x$64   2,195,200

Paid in Capital in Excess of Par                                                      1,852,200

Common Stock Dividend distributable  ( 343,000 x10%x$10)      343,000

Being the declaration of dividend

b) date of Distribution

Description                                                    Debit                            Credit

Distribution Date

Common Stock Dividend distributable    343,000

Common Stock                                                                                  343,000

Being the Distribution of declared of dividend

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