Problem:
Gordon's Meats has 6,500 shares of stock outstanding. The market value is $26.50 per share. The statement of financial position shows $48,200 common stock account, and $142,900 in the retained earnings account. The firm just announced a 5 percent stock dividend.
Required:
Question: What will the balance be in the common stock and retained earnings accounts after the dividend?
Note: Please explain comprehensively and give step by step solution.