The Capital Corporation had stockholders equity on January 1, 2000 as follows:

Common Stock, $5 par value, 1,000,000 shares authorized, 525,000 shares issued and outstanding
$2,625,000
Paid-in Capital/Contributed Capital in excess of par value
$1,025,000
Retained Earnings
$2,850.000
Please prepare journal entries for the following transactions.
May 1
A cash dividend of $1.10 per share was declared by the Board of Directors to stockholders of record on May 20th, payable on June 1st.
June 1
Paid the cash dividend.
july 1
Board of Directors declared a 10% stock dividend with a market vale of $23 per share to the stockholders of record on July 15th, distributed on
August 1st.

Common Stock, $5 par value, 1,000,000 shares authorized, 525,000 shares issued and outstanding$2,625,000
Paid-in Capital/Contributed Capital in excess of par value $1,025,000
Retained Earnings $2,850.000

Solution
May 1
A cash dividend of $1.10 per share was declared by the Board of Directors to stockholders of record on May 20th, payable on June 1st.
June 1
Paid the cash dividend.
july 1
Board of Directors declared a 10% stock dividend with a market vale of $23 per share to the stockholders of record on July 15th, distributed on
August 1st.
DebitCredit
Retained Earning577500
Dividend Payable 577500