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Langley Corporation has 44,500 shares of $10 par value common stock outstanding. It declares a 15%...

Langley Corporation has 44,500 shares of $10 par value common stock outstanding. It declares a 15% stock dividend on December 1 when the market price per share is $18. The dividend shares are issued on December 31. Prepare the entries for the declaration and issuance of the stock dividend.

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Given Information

No of Shares Outstanding 44500
Stock Dividend 15%
No of shares to be issued 6675
Par value at $ 10 per share (44500*15%*10) $66,750
issue Price at $18 - Market Price (44500*15%*18) $120,150
Date Particulars Debit Credit
Dec-01 Stock Dividend A/c Dr. $ 1,20,150
      To Common stock dividend Distributable A/c Cr. $      66,750
      To Add Paid In capital Inexcess of par A/c Cr. $      53,400
(To Record Declaration of stock Dividend)
Dec-31 Common stock dividend Distributable A/c Dr. $    66,750
          To Common Stock A/c Cr. $      66,750
(To record issue of shares)
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