Aggregate Mining Corporation was incorporated five years ago. It is authorized to issue 600,000 shares of $100 par value 8% preferred stock. It is also authorized to issue 750,000 shares of $1 par value common stock. It has issued only 40,000 of the common shares and none of the preferred shares. In its sixth year, the corporation has the following transactions:Mar. 1Declares a cash dividend of $2 per share.Mar. 30Pays the cash dividend.Jul. 10Declares a 5% stock dividend when the stock is trading at $15 per share.Aug. 5Issues the stock dividend.Prepare the journal entries to record the transactions. If an amount box does not require an entry, leave it blank.Mar. 1 Retained EarningsRetained Earnings Cash Dividends PayableCash Dividends PayableMar. 30 Cash Dividends PayableCash Dividends Payable CashCashJul. 10 Retained EarningsRetained Earnings Common Stock Dividend DistributableCommon Stock Dividend Distributable Additional Paid-in Capital-Common StockAdditional Paid-in Capital-Common StockAug. 5 Common Stock Dividend DistributableCommon Stock Dividend Distributable

Introduction: An organization can declare dividends either in cash or in the form of stock…

Answered: Aggregate Mining Corporation was…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Aggregate Mining Corporation was incorporated five years ago. It is authorized to issue 600,000 shares of $100 par value 8% preferred stock. It is also authorized to issue 750,000 shares of $1 par value common stock. It has issued only 40,000 of the common shares and none of the preferred shares. In its sixth year, the corporation has the following transactions:

Mar. 1	Declares a cash dividend of $2 per share.
Mar. 30	Pays the cash dividend.
Jul. 10	Declares a 5% stock dividend when the stock is trading at $15 per share.
Aug. 5	Issues the stock dividend.

Prepare the journal entries to record the transactions. If an amount box does not require an entry, leave it blank.

Mar. 1	Retained Earnings	Retained Earnings
	Cash Dividends Payable	Cash Dividends Payable
Mar. 30	Cash Dividends Payable	Cash Dividends Payable
	Cash	Cash
Jul. 10	Retained Earnings	Retained Earnings
	Common Stock Dividend Distributable	Common Stock Dividend Distributable
	Additional Paid-in Capital-Common Stock	Additional Paid-in Capital-Common Stock
Aug. 5	Common Stock Dividend Distributable	Common Stock Dividend Distributable

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