The stockholders’ equity section of TVX Company on February 4 follows.Common stock—$5 par value, 150,000 shares authorized, 58,000 shares issued and outstanding$ 290,000Paid-in capital in excess of par value, common stock424,000Retained earnings553,000Total stockholders’ equity$ 1,267,000On February 5, the directors declare a 2% stock dividend distributable on February 28 to the February 15 stockholders of record. The stock’s market value is $41 per share on February 5 before the stock dividend. 1Record the declaration of a 2% stock dividend. 2Record the distribution of a 2% stock dividend.

Note: When the stock dividend is issued then retained earnings are decreased by the market value of…

Answered: The stockholders’ equity section of TVX…

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter21: Corporations: Taxes, Earnings, Distributions, And The Statement Of Retained Earnings

Section: Chapter Questions

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The stockholders’ equity section of TVX Company on February 4 follows.

Common stock—$5 par value, 150,000 shares authorized, 58,000 shares issued and outstanding	$ 290,000
Paid-in capital in excess of par value, common stock	424,000
Retained earnings	553,000
Total stockholders’ equity	$ 1,267,000

On February 5, the directors declare a 2% stock dividend distributable on February 28 to the February 15 stockholders of record. The stock’s market value is $41 per share on February 5 before the stock dividend.