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Grouper Corporation has outstanding 3,015,000 ordinary shares with a par value of $10 each. The balance in its retained earnings account at January 1, 2022, was $24,224,000, and it then had Share Premium of $5,012,000. During 2022, the company's net income was $4,715,000. A cash dividend of $0.50 per share was declared on May 5, 2022, and was paid June 30, 2022, and a 6% share dividend was declared on November 30, 2022, and distributed to shareholders of record at the close of business on December 31, 2022. You have been asked to advise on the proper accounting treatment of the share dividend The existing shares of the company are quoted on a national securities exchange. The market price of the shares has been as follows. October 31, 2022 November 30, 2022 December 31, 2022 (a) (b) Date (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 O for the amounts) May 5 Prepare the journal entry to record (1) the declaration and (2) payment of the cash dividend. Prepare the journal entry to record (1) the declaration and (2) distribution of the share dividend. une 30 V lov. 30 $32 $35 $39 lec. 31 v Account Titles and Explanation Retained Earnings Dividends Payable Dividends Payable Cash Retained Earnings Ordinary Shares Dividend Distributable Ordinary Shares Dividend Distributable Share Capital-Ordinary Debit 1507500 1507500 6331500 6331500 Credit 1507500 1507500 6331500 6331500

Grouper Corporation has outstanding 3,015,000 ordinary shares with a par value of $10 each. The balance in its retained earnings account at January 1, 2022, was $24,224,000, and it then had Share Premium of $5,012,000. During 2022, the company's net income was $4,715,000. A cash dividend of $0.50 per share was declared on May 5, 2022, and was paid June 30, 2022, and a 6% share dividend was declared on November 30, 2022, and distributed to shareholders of record at the close of business on December 31, 2022. You have been asked to advise on the proper accounting treatment of the share dividend The existing shares of the company are quoted on a national securities exchange. The market price of the shares has been as follows. October 31, 2022 November 30, 2022 December 31, 2022 (a) (b) Date (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 O for the amounts) May 5 Prepare the journal entry to record (1) the declaration and (2) payment of the cash dividend. Prepare the journal entry to record (1) the declaration and (2) distribution of the share dividend. une 30 V lov. 30 $32 $35 $39 lec. 31 v Account Titles and Explanation Retained Earnings Dividends Payable Dividends Payable Cash Retained Earnings Ordinary Shares Dividend Distributable Ordinary Shares Dividend Distributable Share Capital-Ordinary Debit 1507500 1507500 6331500 6331500 Credit 1507500 1507500 6331500 6331500

FINANCIAL ACCOUNTING
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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Grouper Corporation has outstanding 3,015,000 ordinary shares with a par value of $10 each. The balance in its retained earnings account at January 1, 2022, was $24,224,000, and it then had Share Premium of $5,012,000. During 2022, the company's net income was $4,715,000. A cash dividend of $0.50 per share was declared on May 5, 2022, and was paid June 30, 2022, and a 6% share dividend was declared on November 30, 2022, and distributed to shareholders of record at the close of business on December 31, 2022. You have been asked to advise on the proper accounting treatment of the share dividend. The existing shares of the company are quoted on a national securities exchange. The market price of the shares has been as follows. October 31, 2022 November 30, 2022 December 31, 2022 (a) (b) Date May 5 (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 O for the amounts) une 30 lov. 30 Transcribed Text $32 $35 $39 Prepare the journal entry to record (1) the declaration and (2) payment of the cash dividend. Prepare the journal entry to record (1) the declaration and (2) distribution of the share dividend. lec 31 v Account Titles and Explanation Retained Earnings Dividends Payable Dividends Payable Cash Retained Earnings Ordinary Shares Dividend Distributable Ordinary Shares Dividend Distributable Share Capital-Ordinary Debit 1507500 1507500 6331500 1 6331500 Credit 1507500 1507500 6331500 6331500
Transcribed Image Text:Grouper Corporation has outstanding 3,015,000 ordinary shares with a par value of $10 each. The balance in its retained earnings account at January 1, 2022, was $24,224,000, and it then had Share Premium of $5,012,000. During 2022, the company's net income was $4,715,000. A cash dividend of $0.50 per share was declared on May 5, 2022, and was paid June 30, 2022, and a 6% share dividend was declared on November 30, 2022, and distributed to shareholders of record at the close of business on December 31, 2022. You have been asked to advise on the proper accounting treatment of the share dividend. The existing shares of the company are quoted on a national securities exchange. The market price of the shares has been as follows. October 31, 2022 November 30, 2022 December 31, 2022 (a) (b) Date May 5 (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 O for the amounts) une 30 lov. 30 Transcribed Text $32 $35 $39 Prepare the journal entry to record (1) the declaration and (2) payment of the cash dividend. Prepare the journal entry to record (1) the declaration and (2) distribution of the share dividend. lec 31 v Account Titles and Explanation Retained Earnings Dividends Payable Dividends Payable Cash Retained Earnings Ordinary Shares Dividend Distributable Ordinary Shares Dividend Distributable Share Capital-Ordinary Debit 1507500 1507500 6331500 1 6331500 Credit 1507500 1507500 6331500 6331500
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