On January 1, 2018, Bowie Corp. had the following balances (all balances are normal): Accounts Amount Preferred

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Question:

On January 1, 2018, Bowie Corp. had the following balances (all balances are normal):

Accounts

Amount

Preferred Stock, ($100 par value, 4% noncumulative, 50,000 shares authorized, 6,000 shares issued and outstanding) $600,000

Common Stock ($5 par value, 200,000 shares authorized, 100,000 shares issued and outstanding) $500,000

Paid-in Capital in Excess of par, Common 200,000

Retained Earnings 900,000

The following events occurred during 2018:

On January 1, Bowie Corp. declared a 4% stock dividend on its common stock when the market value of the common stock was $12 per share. Stock dividends were distributed on January 31 to shareholders as of January 25.

On February 15, Bowie Corp. reacquired 500 shares of common stock for $12.50 each.

On March 31, Bowie Corp. reissued 250 shares of treasury stock for $18 each.

On July 1, Bowie Corp. reissued 250 shares of treasury stock for $10 each.

On October 1, Bowie Corp. declared full year dividends for preferred stock and $2.00 cash dividends for outstanding shares and paid shareholders on October 15.

On December 15, Bowie Corp. split common stock 2 shares for 1.

Net Income for 2018 was $200,000.

A. Prepare journal entries for the transactions listed above.

B. Show Stockholders' section of a classified balance sheet as of December 31, 2018 (after taking into consideration your journal entries)