On July 31, 2014, Just Prior to Year-End, the Board

question 40

Essay

On July 31, 2014, just prior to year-end, the Board of Directors of Watts and Peppicelli Ltd declared a
5% stock dividend.At the time the dividend was paid the company had 80,000 shares of common stock issued and outstanding.The articles of incorporation indicated that the company was authorized to issue up to 200,000 common shares.At the time the dividend was declared, the book value of the common shares was $20.The shares were issued for an average cost of $23 and had a market value at the date of the stock dividend declaration of $38 per share.Retained earnings amounted to $900,000.
Required:
A) Prepare the entry to record the stock dividend.
B) Prepare the shareholders' equity section of the balance sheet at July 31, 2014, immediately after the payment of the stock dividend.

• A) Prepare the entry to record the stock dividend.
• B) Prepare the shareholders' equity section of the balance sheet at July 31, 2014, immediately after the payment of the stock dividend.

Comprehend the effects of investments on net income and shareholder's equity.

Grasp the implications of temporary versus other-than-temporary declines in the value of investments.

Analyze the impact of errors in classification of securities on financial statements.

Identify the factors influencing the exertion of significant influence over an investee.

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Definitions:

MDMA

A synthetic drug known for its psychoactive properties, often used recreationally for its euphoric effects.

Priapism

A medical condition involving a persistent and often painful erection of the penis that lasts for hours and is unrelated to sexual arousal.

Hallucinogenic

Substances that cause hallucinations—perceptions or experiences that differ from reality—and alter a person's thinking, sense of time and emotions.

Eating Disorder

Serious and often fatal illness that causes disturbances to a person’s eating behaviors.