Reference no: EM132503219

Question 1: How to process Problem stock holders equity section (Requirement of the Problem).

Detail's Below

1. Sage Corporation has outstanding 2,972,000 shares with common stock of a par value of $10 each. The balance in its Retained Earnings account at January 1, 2017, was $24,230,000, and it then had Paid-in Capital in Excess of Par-Common Stock of $4,994,000.
2. During 2017, the company's net income was $4,694,000. A cash dividend of $0.60 a share was declared on May 5, 2017, and was paid June 30, 2017, and a 6% stock dividend was declared on November 30, 2017, and distributed to stockholders of record at the close of business on December 31, 2017. You have been asked to advise on the proper accounting treatment of the stock dividend.

Requirement

Question 2: Prepare the stockholders' equity section (including schedules of retained earnings and additional paid-in capital) of the balance sheet of Pina Corporation for the year 2017 on the basis of the foregoing information.