Elite Electrical has 360,000 shares of $3-par common stock outstanding. They have declared a 6% stock dividend. The current market price of the common stock is $8.50/share. The amount that will be debited to Retained Earnings on the date of declaration is:

Question

Quizplus · Accepted Answer

The amount debited to Retained Earnings is calculated by multiplying the number of shares to be issued (6% of 360,000 shares = 21,600 shares) by the market price per share ($8.50), resulting in $183,600.

Elite Electrical Has 360,000 Shares of $3-Par Common Stock Outstanding