Flatfish Limited reported the following items in shareholders' equity on December 31, 2020: Share capital:...
60.1K
Verified Solution
Link Copied!
Question
Accounting
Flatfish Limited reported the following items in shareholders' equity on December 31, 2020: Share capital: Preferred shares, $5 cumulative dividend, 150,000 shares issued Share capital: Common shares, 750,000 issued and outstanding $15,000,000 30,000,000 25,000,000 Retained earnings Early in 2021, when its common shares were selling at $59 per share, the company declared and distributed a 10% stock dividend. Describe the impact that this declaration will have on the shareholders' equity accounts. (Hint: It may be helpful to prepare the journal entry and closing entry related to this transaction.) Explain why a company would choose to issue a stock dividend rather than a cash dividend
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
