Retained Earnings: Transactions and Statement The stockholders’ equity of Carly Corporation at January 1 follows: 6 Percent preferred stock, $10 par value, 40,000 shares authorized; 25,000 shares issued and outstanding $250,000 Common stock, $1 par value, 300,000 shares authorized; 80,000 shares issued and outstanding 80,000 Paid-in capital in excess of par value—Common stock 560,000 Retained earnings 830,000 Total Stockholders’ Equity $1,720,000 The following transactions, among others, occurred during the year: June 18 Declared a 70 percent stock dividend on all outstanding shares of common stock. The market value of the stock was $14 per share. July 1 Issued the stock dividend declared on June 18. Dec. 20 Declared the annual cash dividend on the preferred stock and a cash dividend of $1.80 per share on the common stock, payable on January 20 to stockholders of record on December 28. Required a. Prepare journal entries to record the foregoing transactions. General Journal Date Description Debit Credit Jun.18 Answer Answer Answer Answer Answer Answer Declared stock dividend. Jul.1 Answer Answer Answer Answer Answer Answer Issued common shares as stock dividend. Dec.20 Answer Answer Answer Answer Answer Answer Dividends Payable - Common Stock Answer Answer Declared a cash dividend on preferred and common stock outstanding. b. Prepare a statement of retained earnings. The net income for the year is $500,000. Do not use negative signs with your answers. CARLY CORPORATION Statement of Retained Earnings For the Year Ended December 31 Retained Earnings, January 1 Answer Answer Answer Answer Answer Answer Stock Dividends Declared Answer Answer Answer Answer

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter20: Corporations: Organization And Capital Stock

Section: Chapter Questions

Problem 1MP: Stockholders equity accounts and other related accounts of Gonzales Company as of January 1, 20--,...

Related questions

Question

Retained Earnings: Transactions and Statement

The stockholders’ equity of Carly Corporation at January 1 follows:

6 Percent preferred stock, $10 par value, 40,000 shares authorized;
25,000 shares issued and outstanding	$250,000
Common stock, $1 par value, 300,000 shares authorized; 80,000 shares
issued and outstanding	80,000
Paid-in capital in excess of par value—Common stock	560,000
Retained earnings	830,000
Total Stockholders’ Equity	$1,720,000

The following transactions, among others, occurred during the year:

June	18	Declared a 70 percent stock dividend on all outstanding shares of common stock. The market value of the stock was $14 per share.
July	1	Issued the stock dividend declared on June 18.
Dec.	20	Declared the annual cash dividend on the preferred stock and a cash dividend of $1.80 per share on the common stock, payable on January 20 to stockholders of record on December 28.

Required

a. Prepare journal entries to record the foregoing transactions.

General Journal
Date	Description	Debit	Credit
Jun.18	Answer	Answer	Answer
	Answer	Answer	Answer
	Declared stock dividend.
Jul.1	Answer	Answer	Answer
	Answer	Answer	Answer
	Issued common shares as stock dividend.
Dec.20	Answer	Answer	Answer
	Answer	Answer	Answer
	Dividends Payable - Common Stock	Answer	Answer
	Declared a cash dividend on preferred and common stock outstanding.