Reference no: EM132962077

Douglas McDonald Company's balance sheet included the following shareholders' equity accounts at December 31, 2020:

($ in millions) Paid-in capital:

Common stock, 1,400 million shares at $1 par $ 1,400

Paid-in capital-excess of par 16,800

Retained earnings 15,638

Total shareholders' equity $ 33,838

On March 16, 2021, a 4% common stock dividend was declared and distributed. The market value of the common stock was $31 per share. Fractional share rights represented 3 million equivalent whole shares. Cash was paid in lieu of the fractional share rights.

Required:

Problem 1. Calculate the value of shares issued.

Problem 2. Prepare the appropriate entries for the declaration and distribution of the stock dividend.