Dividend Distribution Assignment – Brescia Corporation Brescia Corporation's shareholders' equity section at December 31, 2021 appears below: Shareholders' equity Common shares, no par value, 50,000 shares issued. $600,000 Retained earnings. 150,000 Total shareholders' equity $750.000 On June 30, 2022, the board of directors of Holiday Travel Corporation declared a 10% stock dividend, payable on July 31, 2022, to shareholders of record on July 15, 2022. The fair market value of Brescia Corporation's shares on June 30, 2022, was $12 per share. On December 1, 2022, the board of directors declared a 2-for-1 stock split effective December 15, 2022. Holiday Travel Corporation's shares were selling for $16 on December 1, 2022, before the stock split was declared. Net income for 2022 was $225,000 and there were no cash dividends declared. (a) Prepare the journal entries on the appropriate dates to record the stock dividend and the stock split. (b) Fill in the amount that would appear in the shareholders' equity section for Brescia Corporation at December 31, 2022, for the following items: 1. Common shares $_____ 2. Number of shares issued _ 3. Retained earnings $_ 4. Total shareholders' equity $_____

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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Dividend Distribution Assignment – Brescia Corporation

Brescia Corporation's shareholders' equity section at December 31, 2021 appears below:

Shareholders' equity

Common shares, no par value, 50,000 shares issued. $600,000

Retained earnings. 150,000

Total shareholders' equity $750.000

On June 30, 2022, the board of directors of Holiday Travel Corporation declared a 10% stock dividend, payable on July 31, 2022, to shareholders of record on July 15, 2022. The fair market value of Brescia Corporation's shares on June 30, 2022, was $12 per share.

On December 1, 2022, the board of directors declared a 2-for-1 stock split effective December 15, 2022. Holiday Travel Corporation's shares were selling for $16 on December 1, 2022, before the stock split was declared. Net income for 2022 was $225,000 and there were no cash dividends declared.

(a) Prepare the journal entries on the appropriate dates to record the stock dividend and the stock split.

(b) Fill in the amount that would appear in the shareholders' equity section for Brescia Corporation at December 31, 2022, for the following items:

1. Common shares $_________

2. Number of shares issued _________

3. Retained earnings $_________

4. Total shareholders' equity $_________

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