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Madrid Corporation has 18,000 shares of $40 par common stock outstanding. On June 8, Madrid Corporation...

Madrid Corporation has 18,000 shares of $40 par common stock outstanding. On June 8, Madrid Corporation declared a 5% stock dividend to be issued August 12 to stockholders of record on July 13. The market price of the stock was $46 per share on June 8.

Journalize the entries required on June 8, July 13, and August 12. For a compound transaction, if an amount box does not require an entry, leave it blank. If no entry is required, select "No Entry Required" and leave the amount boxes blank.

Jun. 8 Stock Dividends fill in the blank 2 fill in the blank 3
Stock Dividends Distributable fill in the blank 5 fill in the blank 6
Paid-In Capital in Excess of Par-Common Stock fill in the blank 8 fill in the blank 9
Jul. 13 No Entry Required fill in the blank 11
No Entry Required fill in the blank 13
Aug. 12 Stock Dividends Distributable fill in the blank 15
Common Stock fill in the blank 17
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Answer #1
Date Accounts and Explanation Debit Credit
Jun.08 Retained Earnings [(18000*5%)*46] $         41,400
Stock Dividend Distributable [(18000*5%)*40] $          36,000
Paid-In-Capital Excess of Par-Common stock [(18000*5%)*6] $             5,400
( To record declaration of stock dividend)
Jul.13 No entry
Aug.12 Stock Dividend Distributable $         36,000
Common Stock $          36,000
( To record distribution of common stock)
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