What entry to record declaration of ten cent stock dividend

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Problem 1: Samson Inc. as 1000 common shares issued at $100 and currently trading t $200. The entry to record declaration of a 10% stock dividend is:

1) DR Common stock dividends distributable $100,000 - CR Retained earnings $100,000

2) CR Cash $100,000 - DR Retained earnings $100,000

3) CR Common stock dividends distributable $20,000 - DR Stock dividends $20,000

4) DR Common stock dividends distributable $20,000 - CR Common shares $20,000

Reference no: EM132760021

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