On January 1, Swanson Corporation had 60,000 ordinary shares with a €10 par value outstanding.On March 17, the company declared a 15% share dividend to shareholders of record on March 20.Market value of the shares was €13 on March 17.The shares were distributed on March 30.The entry to record the transaction of March 30 would include a

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The entry to record the share dividend is to debit the Retained Earnings account and credit the Ordinary Share Dividends Distributable account for the fair value of the dividend. In this case, the fair value is 15% of the market value of the outstanding shares, which is €117,000 (60,000 x €13 x 15%). The Ordinary Share Dividends Distributable account is a temporary account that is closed to the Ordinary Share Capital account after the dividend is paid. Therefore, the entry to record the distribution of the share dividend on March 30 would be to debit the Ordinary Share Dividends Distributable account for €117,000 and credit the Ordinary Share Capital account for €117,000 (60,000 x €13 x 15%).

On January 1, Swanson Corporation Had 60,000 Ordinary Shares with a €10