Pillsbury Company Declares and Distributes a 30% Common Stock Dividend

Multiple Choice

Pillsbury Company declares and distributes a 30% common stock dividend when it has 90,000 shares of $10 par common stock outstanding.The market price per share is $35 at the date of declaration.Which journal entry is prepared?

A) debit Retained Earnings $945,000,credit Common Stock $270,000 and credit Paid-in Capital in Excess of Par-Common $675,000
B) debit Retained Earnings $945,000,credit Paid-in Capital in Excess of Par-Common $945,000
C) debit Retained Earnings $945,000 and credit Common Stock $945,000
D) debit Retained Earnings $270,000 and credit Common Stock $270,000