Question

Please solve and detail all solutions

100 points on December 31, the 9toddolders' eauty aection of the balance eheetof尺& B Corporation renected the folowirg: Cor"m'un slock (:par $10; authorizu 60.300 shares, ouLelandng 25,300 shar ddilienal paid- apial Retaired carnirgs 5253,000 2,300 76,500 On February 1 orte: falong year. u 12 perceni stock dividend was isued. The rarkel vaut ofthe stck an Febrary 1 was 31a per share Required: 1. Far campaative purpcses, prpare the sirckhalders' equity sectin of the balance sheet (a) immediatey ansara thn sbark dvirand and ( immediaoy ater the strck dividrnd. Stockholders' Equity Before After Stock Dividend Dividend Stock Contributed Cacitel Totel Contriouted Capilel Tata Strckhalters Equity 2· lf the stack dvinend were 100%, walld the balance in addtional paisin capital change? No

Answer 1

Requirement 1

	Before Stock Dividend	Stock Dividend	After Stock Dividend
Contributed Capital:
Common Stock	$       2,53,000.00	$         30,360.00	$     2,83,360.00
Additional paid in Capital	$          12,300.00	$         24,288.00	$         36,588.00
Total Contributed Capital	$       2,65,300.00	$         54,648.00	$     3,19,948.00
Retained Earnings	$          76,500.00	$       (54,648.00)	$         21,852.00
Total Stockholder's equity	3,41,800.00	-	3,41,800.00

Requirement 2

Yes

If the stock dividend is 100% the additional paid in capital would be more than what it is is 12%.

Working

Common Stock in number of shares	25300	shares outstanding
Dividend 12%	3036	shares
Dividend stock at par $5	$          30,360.00	[3036 x $10]
Dividend shares in cash excess of par	$          24,288.00	[3036 x $(18-10)]