Walley, Inc. has the following stockholders' equity section. Three transactions that Walley could have made are listed below. Answering each part independently (assume that the stockholders' equity at the time of each transaction is as shown below), present the proper journal entry to record each transaction. Note that the journal entry for a transaction should not be affected by the entry for any other transaction listed below. Explanations may be omitted, but show computations.
Required:
a. A cash dividend of $6.00 per share of common stock is declared.
b. A 7% stock dividend is declared; the current market value of the stock is $60 per share.
c. A 28% stock dividend is declared; the current market value of the stock is $60 per share.

Question

Walley, Inc. has the following stockholders' equity section. Three transactions that Walley could have made are listed below. Answering each part independently (assume that the stockholders' equity at the time of each transaction is as shown below), present the proper journal entry to record each transaction. Note that the journal entry for a transaction should not be affected by the entry for any other transaction listed below. Explanations may be omitted, but show computations. 
Required:
  a. A cash dividend of $6.00 per share of common stock is declared.
b. A 7% stock dividend is declared; the current market value of the stock is $60 per share.
c. A 28% stock dividend is declared; the current market value of the stock is $60 per share.

Quizplus · Accepted Answer

The Answer of Walley, Inc. has the following stockholders' equity section. Three transactions that Walley could have made are listed below. Answering each part independently (assume that the stockholders' equity at the time of each transaction is as shown below), present the proper journal entry to record each transaction. Note that the journal entry for a transaction should not be affected by the entry for any other transaction listed below. Explanations may be omitted, but show computations. 
Required:
  a. A cash dividend of $6.00 per share of common stock is declared.
b. A 7% stock dividend is declared; the current market value of the stock is $60 per share.
c. A 28% stock dividend is declared; the current market value of the stock is $60 per share.