[whittle8]

Organic Health Co. is an HMO for businesses in the Chicago area. The following account balances appear on the balance sheet of Organic Health Co.: Common stock (300,000 shares authorized), $100 par, $10,000,000; Paid-In Capital in excess of par— common stock, $2,000,000; and Retained earnings, $45,000,000. The board of directors declared a 2% stock dividend when the market price of the stock was $125 a share. Organic Health Co. reported no income or loss for the current year. Journalize the entry to record the declaration of the dividend, capitalizing an amount equal to market value.

[Just Looking]

Please read the following announcement.

https://www.askmehelpdesk.com/financ...-b-u-font.html

I will help you with this if you will do your part by working with me. Is there something specific you don't understand? Do you understand what a stock dividend is?

[whittle8]

I do understand what a stock dividend is just not sure where to start with this journal entry.

[Just Looking]

Well, let's start with the amount of the stock dividend. Do you know how to compute the number of shares involved?

[whittle8]

I figured out the problem. Thank you for your help.

[Just Looking]

You did it on your own. Thanks for letting me know. :)