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Question 4 Partially correct Mark 0.58 out of 1.00 Accounting for Large Stock Dividend and Stock Split Watts Corporation has 40,000 shares of $10 par value common stock outstanding and retained earnings of $820,000. The company declares a 100% stock dividend. The market price at the declaration is $17 per share. a. Prepare the general journal entry for the stock dividend. If no journal entry is required, select "No entry" for your answers. General Journal Description Retained earnings Additional paid in capital x Description Additional paid in capital Common stock Flag question Debit 400,000 ✓ 0✓ ♦ x x Debit 400,000 * 0 ✓ Credit b. Assume that the company splits its stock two shares for one share and reduces the par value from $10 to $5 rather than declaring a 100% stock dividend. How does the accounting for the stock split differ from the accounting for the 100% stock dividend? Prepare the journal entry for the stock split. If no journal entry is required, select "No entry" for your answers. General Journal 0✔ 400,000 ✓ Edit question Credit 0✔ 400,000 x
dividend. The market price a Additional paid in capital Cash Common stock ✓ Retained No entry earnings na ec Jc