Answer:
Retained earnings would go down by $300,000
Total paid-in capital would go up by $300,000
Explanation:
The 10% stock dividend is to be calculated based on the stock market price of $30,hence the total market value is $30*100,000=$3,000,000
10% stock dividend =$3,000,000*10%=$300,000
The necessary double entries for stock dividend is to debit retained earnings to the tune of $300,000 and corresponding credit entry is posted to common stock.
Stock dividend implies payment of dividends as shares instead of the traditional payment of cash dividends
