Kaido Company showed the following data: Share capital, par value P100, 50,000 shares issued 5,000,000 Share premium 200,000 Retained earnings 2,000,000 Market value of share on declaration date 150 Market value of share on distribution date 170 Required: For each of the following, prepare journal entries on the date of declaration and date of payment: 1. A 20% stock dividend is declared 2. A 10% stock dividend is declared

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Stockholder's Equity

The stockholders’ equity (often referred to as the book value of the company) is the number of assets available to the stockholder after its entire liabilities is paid off. The stockholders’ equity is also sometimes referred to as owner's equity. The stockholders’ equity or book value generally includes common stock, treasury stock retained earnings. It is an indicator of a company's financial strength and is an important item on the company's balance sheet.