The stockholders' equity of Palepu Company at December 31, 2018. appears below. Common stock, $10 par value,
Question:
The stockholders' equity of Palepu Company at December 31, 2018. appears below.
Common stock, $10 par value, 200,000 shares authorized;
80,000 shares issued and outstanding.................................... $800,000
Paid-in capital in excess of par value ...................................... 480,000
Retained earnings ...................................................................... 305,000
During 2019. the following transactions occurred:
May 12 Declared and issued a 7% stock dividend; the common stock market value was $18 per share.
Dec. 31 Declared and paid a cash dividend of 75 cents per share.
a. Using the financial statement effects template, illustrate the effects of these transactions.
b. Prepare the journal entries for these transactions.
c. Post the journal entries from b to the related T-accounts.
d. Prepare a retained earnings reconciliation for 2019 assuming that the company reports 2019 net income of $283,000.
Step by Step Answer:
Financial Accounting
ISBN: 9781618533111
6th Edition
Authors: Michelle L. Hanlon, Robert P. Magee, Glenn M. Pfeiffer, Thomas R. Dyckman