On october 1, 2018, nicklaus corporation receives permission to replace its $1 par value common stock (6,000,000 shares authorized, 4,000,000 shares issued, and 3,800,000 shares outstanding) with a new common stock issue having a $.50 par value. since the new par value is one-half the amount of the old, this represents a 2-for-1 stock split. that is, the shareholders will receive two shares of the $.50 par stock in exchange for each share of the $1 par stock they own. the $1 par stock will be collected and destroyed by the issuing corporation.
on november 1, 2018, the nicklaus corporation declares a $0.20 per share cash dividend on common stock and a $0.37 per share cash dividend on preferred stock. payment is scheduled for december 1, 2018, to shareholders of record on november 15, 2018. on december 2, 2018, the nicklaus corporation declares a 2% stock dividend payable on december 28, 2018, to shareholders of record on december 14. at the date of declaration, the common stock was selling in the open market at $10 per share. the dividend will result in 152,000 (0.02 × 7,600,000) additional shares being issued to shareholders. required: 1. prepare journal entries to record the declaration and payment of these stock and cash dividends.