Question: Use the information from BE15-13, but assume Green Day Corporation

declared a 100% stock dividend rather than a 5% stock dividend. Prepare the
journal entries for both the date of declaration and the date of distribution.
Answer
The dividend distributed by Green Day Corporation is $4,000,000
Step-by-Step Solution
Step 1: Meaning of Stock Dividend
A stock dividend is a way utilized by agencies to distribute wealth to shareholders, is a
dividend price made inside the shape of shares instead of cash. Stock dividends
are mostly issued in lieu of coins dividends while the enterprise is low on liquid cash on
hand.
Step 2: Preparing Journal Entries
Date Particular Folio Debit USD Credit USD
$ $
Declaration Retained Earnings A/c. Dr.
Date 4,000,000
To Common stock Dividend 4,000,000
Distributable A/c. Cr.
(being dividend declared)

Distribution Common Stock Dividend 4,000,000

Date Distributable A/c. Dr.
To Common Stock A/c. Cr. 4,000,000
(being dividend distributed)