On January 1, 2018, Wirth Corporation, a publicly traded company, had these shareholders' equity accounts: Common shares

Question:

On January 1, 2018, Wirth Corporation, a publicly traded company, had these shareholders' equity accounts:

Common shares (unlimited number of shares authorized, 220,000 shares issued).........$2,200,000

Retained earnings..............................................................................................................1,080,000

Accumulated other comprehensive income..........................................................................120,000

During the year, the following transactions occurred:

Jan. 15 Declared a $1 per share cash dividend to shareholders of record on January 31, payable February 15.

Apr. 16 Declared a 10% stock dividend to shareholders of record on April 30, distributable May 16. On April 16, April 30, and May 15, the share prices were $15, $13.50, and $14, respectively.

Oct. 1 Effected a 2-for-1 stock split. On October 1, the share price was $20.

Dec. 31 Determined that net income for the year was $700,000.

Instructions

(a) Record the above transactions, including any required entries to close dividends and net income.

(b) Open T accounts as required and post to the shareholders' equity accounts.

(d) Prepare the shareholders' equity section of the statement of financial position at December 31.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...