Answer Happy

Marigold Corporation has
outstanding 200,000 common shares that were issued at
$10 per share. The balances at January 1, 2020, were
$21 million in its Retained Earnings account;
$4.40 million in its Contributed Surplus account; and
$1.20 million in its Accumulated Other Comprehensive Income
account. During 2020, Marigold’s net income was
$3,000,000 and comprehensive income was $3,450,000. A cash
dividend of $0.80 per share was declared and paid on June 30,
2020, and a 4% stock dividend was declared at the fair value
of the shares and distributed to shareholders of record at the
close of business on December 31, 2020. You have been asked to give
advice on how to properly account for the stock dividend. The
existing company shares are traded on a national stock exchange.
The shares’ market price per share has been as follows
Prepare a journal entry to record the cash
dividend. (Credit account titles are automatically
indented when the amount is entered. Do not indent manually.
If no entry is required, select "No Entry" for the account titles
and enter 0 for the amounts.)
Account Titles and Explanation
Debit
Credit
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List of Accounts
Prepare a journal entry to record the stock
dividend. (Credit account titles are automatically
indented when the amount is entered. Do not indent manually.
If no entry is required, select "No Entry" for the account titles
and enter 0 for the amounts.)
Account Titles and Explanation
Debit
Credit