On January 1, 2011, Snider Corporation had the following stockholders’ equity accounts.
|
Common Stock ($10 par value, 90,000 shares issued and outstanding) |
$900,000 |
|
Paid in Capital in Excess of Par Value |
200,000 |
|
Retained Earnings |
540,000 |
During the year, the following transactions occurred.
Jan. 15 Declared a $1 cash dividend per share to stockholders of record on January 31, payable February 15.
Feb. 15 Paid the dividend declared in January.
Apr. 15 Declared a 10% stock dividend to stockholders of record on April 30, distributable
May 15. On April 15, the market price of the stock was $15 per share.
May 15 Issued the shares for the stock dividend.
July 1 Announced a 2 for 1 stock split.The market price per share prior to the announcement was $17. (The new par value is $5.)
Dec. 1 Declared a $0.50 per share cash dividend to stockholders of record on December 15, payable January 10, 2012.
31 Determined that net income for the year was $250,000.
Instructions
(a) Journalize the transactions and the closing entries for net income and dividends.
(b) Enter the beginning balances, and post the entries to the stockholders’ equity accounts. (Note: Open additional stockholders’ equity accounts as needed.)
(c) Prepare a stockholders’ equity section at December 31.