The shareholders’ equity of Raven Company is as shown: RAVEN COMPANY Partial Balance Sheet 1 Common stock, $10 par $200,000.00 2 Additional paid-in capital on common stock 100,000.00 3 Retained earnings 200,000.00 4 $500,000.00 Raven is considering the declaration and issuance of a stock dividend at a time when the market price is $25 per share. Required: 1. Assuming the board of directors recommends a 6% stock dividend, prepare: a. the journal entry at the date of declaration b. the journal entry at the date of issuance c. shareholders’ equity after the issuance 2. Assuming, instead, that a 40% stock dividend is recommended, answer a, b, and c of Requirement 1. Chart of Accounts CHART OF ACCOUNTS Raven Company General Ledger ASSETS 111 Cash 121 Accounts Receivable 141 Inventory 152 Prepaid Insurance 181 Equipment 189 Accumulated Depreciation LIABILITIES 211 Accounts Payable 231 Salaries Payable 250 Unearned Revenue 261 Income Taxes Payable EQUITY 311 Common Stock 315 Common Stock to be Distributed 322 Additional Paid-in Capital on Common Stock 324 Additional Paid-in Capital from Stock Dividend 331 Retained Earnings REVENUE 411 Sales Revenue EXPENSES 500 Cost of Goods Sold 511 Insurance Expense 512 Utilities Expense 521 Salaries Expense 532 Bad Debt Expense 540 Interest Expense 541 Depreciation Expense 559 Miscellaneous Expenses 910 Income Tax Expense Prepare the appropriate journal entries for the declaration on December 1 and payment or distribution of the dividend on December 15, assuming the board of directors recommends a 6% stock dividend. General Journal Instructions PAGE 1 GENERAL JOURNAL DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT 1 2 3 4 5 Prepare the appropriate journal entries for the declaration on December 1 and payment or distribution of the dividend on December 15, assuming the board of directors recommends a 40% stock dividend. General Journal Instructions PAGE 1 GENERAL JOURNAL DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT 1 2 3 4

The shareholders’ equity of Raven Company is as shown: RAVEN COMPANY Partial Balance Sheet 1 Common stock, $10 par $200,000.00 2 Additional paid-in capital on common stock 100,000.00 3 Retained earnings 200,000.00 4 $500,000.00 Raven is considering the declaration and issuance of a stock dividend at a time when the market price is $25 per share. Required: 1. Assuming the board of directors recommends a 6% stock dividend, prepare: a. the journal entry at the date of declaration b. the journal entry at the date of issuance c. shareholders’ equity after the issuance 2. Assuming, instead, that a 40% stock dividend is recommended, answer a, b, and c of Requirement 1. Chart of Accounts CHART OF ACCOUNTS Raven Company General Ledger ASSETS 111 Cash 121 Accounts Receivable 141 Inventory 152 Prepaid Insurance 181 Equipment 189 Accumulated Depreciation LIABILITIES 211 Accounts Payable 231 Salaries Payable 250 Unearned Revenue 261 Income Taxes Payable EQUITY 311 Common Stock 315 Common Stock to be Distributed 322 Additional Paid-in Capital on Common Stock 324 Additional Paid-in Capital from Stock Dividend 331 Retained Earnings REVENUE 411 Sales Revenue EXPENSES 500 Cost of Goods Sold 511 Insurance Expense 512 Utilities Expense 521 Salaries Expense 532 Bad Debt Expense 540 Interest Expense 541 Depreciation Expense 559 Miscellaneous Expenses 910 Income Tax Expense Prepare the appropriate journal entries for the declaration on December 1 and payment or distribution of the dividend on December 15, assuming the board of directors recommends a 6% stock dividend. General Journal Instructions PAGE 1 GENERAL JOURNAL DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT 1 2 3 4 5 Prepare the appropriate journal entries for the declaration on December 1 and payment or distribution of the dividend on December 15, assuming the board of directors recommends a 40% stock dividend. General Journal Instructions PAGE 1 GENERAL JOURNAL DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT 1 2 3 4

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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Question

The shareholders’ equity of Raven Company is as shown:

RAVEN COMPANY

Partial Balance Sheet

1	Common stock, $10 par	$200,000.00
2	Additional paid-in capital on common stock	100,000.00
3	Retained earnings	200,000.00
4		$500,000.00

Raven is considering the declaration and issuance of a stock dividend at a time when the market price is $25 per share.

Required:

1.	Assuming the board of directors recommends a 6% stock dividend, prepare:
a.	the journal entry at the date of declaration
b.	the journal entry at the date of issuance
c.	shareholders’ equity after the issuance
2.	Assuming, instead, that a 40% stock dividend is recommended, answer a, b, and c of Requirement 1.

Chart of Accounts

CHART OF ACCOUNTS

Raven Company

General Ledger

	ASSETS
111	Cash
121	Accounts Receivable
141	Inventory
152	Prepaid Insurance
181	Equipment
189	Accumulated Depreciation

	LIABILITIES
211	Accounts Payable
231	Salaries Payable
250	Unearned Revenue
261	Income Taxes Payable

	EQUITY
311	Common Stock
315	Common Stock to be Distributed
322	Additional Paid-in Capital on Common Stock
324	Additional Paid-in Capital from Stock Dividend
331	Retained Earnings

	REVENUE
411	Sales Revenue

	EXPENSES
500	Cost of Goods Sold
511	Insurance Expense
512	Utilities Expense
521	Salaries Expense
532	Bad Debt Expense
540	Interest Expense
541	Depreciation Expense
559	Miscellaneous Expenses
910	Income Tax Expense

Prepare the appropriate journal entries for the declaration on December 1 and payment or distribution of the dividend on December 15, assuming the board of directors recommends a 6% stock dividend.

General Journal Instructions

PAGE 1

GENERAL JOURNAL

	DATE	ACCOUNT TITLE	POST. REF.	DEBIT	CREDIT
1
2
3
4
5

Prepare the appropriate journal entries for the declaration on December 1 and payment or distribution of the dividend on December 15, assuming the board of directors recommends a 40% stock dividend.

General Journal Instructions

PAGE 1

GENERAL JOURNAL

	DATE	ACCOUNT TITLE	POST. REF.	DEBIT	CREDIT
1
2
3
4

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