Question - Hoffert Enterprises has 500,000 shares of common stock authorizes and 100,000 shares of common stock issued and outstanding. The common stock has a par value of $6 per share. Answer the following 3 scenarios independently.
a) On February 1, 2013, the company declared and issued a two-for-one stock split. Assuming that the company exchanges 200,000 new $3 par value for the old shares, what journal entry would be made by Hoofers Enterprises on February 1, 2013?
b) On February 1, 2013, the company declares and distributes a 15% stock dividend (it is considered a "small stock dividend). The market price of the stock is $11 at the time. Provide the journal entry for the dividend.
c) On February 1, 2015, the company declares and distributes a 100% stock dividend (it is considered a "large" stock dividend). The market price of the stock is $11 at the time. Provide the journal entry for the dividend.