Question - Douglas McDonald Company's balance sheet included the following shareholders' equity accounts at December 31, 2005:
Paid-in capital ($ in millions)
Common stock, 900 million shares at $1 par: $ 900
Paid-in capital-excess of par 15,800
Retained earnings 14,888
Total shareholders' equity $31,588
On March 16, 2006, a 4% common stock dividend was declared and distributed. The market value of the common stock was $21 per share. Fractional share rights represented 2 million equivalent whole shares. Cash was paid in place of the fractional share rights.
Required: Prepare the appropriate entries for the declaration and distribution of the stock dividend.