Small Stock Dividend
Illustrative Entry
| XX-XX-X9 |
575,000 |
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| Common Stock |
115,000 |
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| Paid in Capital in Excess of Par |
460,000 |
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| To record issuance of a 5% stock dividend (2,300,000 assumed shares outstanding X 5% X $5 per share market price = $575,000; assumes par value is $1 per share) |
Note: This entry would not be appropriate for large stock dividends (over 20 to 25%).