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What is the impact of the dividend on retained earnings

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Question - On December 15, 2021, Tripod Inc.'s stock was trading at $3 per share and had the following balances in their equity accounts:

Common Stock ($0.10 Par) 1,000,000

Paid-in-Capital-excess of par, common 6,780,000

Retained Earnings 4,672,000

Required -

a. If Tripod declared and paid a 30% stock dividend, what is the impact of the dividend on Retained Earnings and Paid-in-Capital?

b. If Tripod declared and paid a 20% stock dividend, what is the impact of the dividend on Retained Earnings and Paid-in-Capital?

c. Instead of declaring a stock dividend, Tripod Inc. declared a property dividend of the company's investment in Bad Investments on December 15, 2021. The carrying value of the Bad Investments stock is $6,000,000 and the fair market value is $5,000,000. Prepare the journal entries related to the property dividend declaration.

d. Prepare the journal entry to record the property dividend payment.

Reference no: EM133174091

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