On January 1, 2010, Hayslett Corporation had the following stockholders’ equity accounts.
|
Common Stock ($10 par value, 260,000 shares issued and |
|
|
outstanding) |
$2,600,000 |
|
Paid in Capital in Excess of Par Value |
1,500,000 |
|
Retained Earnings |
3,200,000 |
During the year, the following transactions occurred.
|
April 1 |
Declared a $1.50 cash dividend per share to stockholders of record on April 15, payable May 1. |
|
May 1 |
Paid the dividend declared in April. |
|
June 1 |
Announced a 2 for 1 stock split. Prior to the split, the market price per share was $24. |
|
Aug. 1 |
Declared a 10% stock dividend to stockholders of record on August 15, distributable August 31. On August 1, the market price of the stock was $10 per share. |
|
31 |
Issued the shares for the stock dividend. |
|
Dec. 1 |
Declared a $1.50 per share dividend to stockholders of record on December 15, payable January 5, 2009. |
|
31 |
Determined that net income for the year was $600,000. |
Instructions
(a) Journalize the transactions and the closing entry for net income.
(b) Prepare a stockholders’ equity section at December 31.