The stockholders' equity of Elsworth Corporation at January 1 is shown below:

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

Apr. 1 Declared a 100 percent stock dividend on all outstanding shares of common stock. 

The market value of the stock was \(\$ 16\) per share.
15 Issued the stock dividend declared on April 1.

Dec. 7 Declared a two percent stock dividend on all outstanding shares of common stock. 

The market value of the stock was \(\$ 18\) per share.

Dec. 17 Issued the stock dividend declared on December 7.

20 Declared the annual cash dividend on the preferred stock and a cash dividend of \(\$ 1.20\) per common share, payable on January 15 to common stockholders of record on December 31 .

Required

a. Prepare journal entries to record the foregoing transactions.

b. Prepare a statement of retained earnings. Net income for the year is \(\$ 300,000\).

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5 Percent preferred stock, $100 par value, 10,000 shares authorized; 4,000 shares issued and outstanding... Common stock, $5 par value, 200,000 shares authorized; 50,000 shares issued and outstanding Paid-in capital in excess of par value-Preferred stock. Paid-in capital in excess of par value-Common stock. Retained earnings..... Total Stockholders' Equity.. $ 400,000 250,000 40,000 300,000 656,000 $1,646,000