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Global Corporation had 59,000 shares of $20 par value common stock outstanding on July 1. Later that day the board of directors declared a 25% stock dividend when the market value of each share was $29. The entry to record the dividend declaration is

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Answer:

Explanation:

The journal entry for declaration of dividend is shown below:

Retained earning A/c Dr (59,000 shares × $29 per share × 25%) = $427,750    

       To Common stock dividend distributed (59,000 shares × $20 per share  × 25%) = $295,000

        To Paid in capital in excess of par value common stock = (59,000 shares × $9 per share × 25%) = $132,750

(Being dividend is declared)