Chapter 10, Problem 10.10E

Record stock dividends and stock splits (LO10–6)

On September 1, the board of directors of Colorado Outfitters, Inc., declares a stock dividend on its 10,000, $1 par, common shares. The market price of the common stock is $30 on this date.

Required:

  1.    Record the stock dividend assuming a small (10%) stock dividend.

  2.    Record the stock dividend assuming a large (100%) stock dividend.

  3.    Record the transaction assuming a 2-for-1 stock split.