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Norplast Inc had 200,000 common shares outstanding on January 1. The company declared a 8% stock dividend on March 15 to all common shareholders of record as of March 20. The shares were issued on March 31. The market value of the shares was as follows:
March 15, $1.75:
March 20, $1.80;
March 31, $1.85
Problem 1: Which of the following components would be part of the company's entry on the date of declaration? Option 1: Credit to common shares of $28,800 Option 2: Credit to retained earnings of $28,000 Option 3: Debit to retained earnings of $28,000 Option 4: Debit to retained earnings of $16,000 Option 5: Credit to common shares of $29,600
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