York's outstanding shares consist of 80,000 shares of 7.5% non-cumulative preferred stock with a par value of $5 and also 190,000 shares of common stock with a par value of $1. During its first four years of operation, the corporation declared and paid the following total cash dividends:

Total Cash Dividends 2015	ps	18,000
Total Cash Dividends 2016		28,000
Total Cash Dividends 2017		300.000
Total Cash Dividends 2018		450.000

Exercise 11-8 Dividends on non-cumulative common and preferred shares LO C2

Determine the number of dividends paid each year to each of the two classes of stockholders: preferred and common. Also calculate the total dividends paid to each class for the four years combined. (Round your "Dividend per preferred stock" answers to 3 decimal places.)

	Par Value per Preferred Share	dividend rate	Dividend per Preferred Stock	Number of preferred shares	preferred dividend
Annual Preferred Dividend:
	Total cash dividends paid	Paid to Preferred	Paid to Common	Dividends in arrears at year-end
2015	$18,000
2016	28,000
2017	300.000
2018	450.000
Total:	$796,000	$0	$0

Determine the number of dividends paid each year to each of the two classes of stockholders assuming that the preferred stock is cumulative . Also determine the total dividends paid to each class during the four years combined. (Round your "Dividend per preferred stock" answers to 3 decimal places.)

	Par Value per Preferred Share	dividend rate	Dividend per Preferred Stock	Number of preferred shares	preferred dividend
Annual Preferred Dividend:
	Total cash dividends paid	Paid to Preferred	Paid to Common	Dividends in arrears at year-end
2015	$18,000
2016	28,000
2017	300.000
2018	450.000
Totals	$796,000	$0	$0

As of October 10, the stockholders' equity of Sherman Systems appears as follows.

Common Stock: $10 par value, 74,000 shares authorized, issued and outstanding	ps	740.000
Paid-in capital in excess of par value, common shares		226,000
Retained earnings		880.000
Equity of total shareholders	ps	1,846,000

1. Prepare journal entries to record the following transactions for Sherman Systems.

It bought 5,200 shares of its own capital stock for $27 per share on October 11.

He sold 1,050 treasury shares on November 1 for $33 cash per share.

He sold all of the remaining treasury shares on November 25 for $22 cash per share.

2. Prepare the revised stock section of your balance sheet after the October 11 treasury stock purchase.

Revised equity section of balance sheet after October 11
Total capital contributed	0
Total	0
Equity of total shareholders	$0

Kohler Corporation reports the following components of stockholders' equity as of December 31, 2016:

Common Stock: $20 par value, 100,000 shares authorized, 45,000 shares issued and outstanding	ps	900,000
Paid-in capital in excess of par value, common shares		60.000
Retained earnings		460.000
Equity of total shareholders	ps	1,420,000

In 2017, the following transactions affected your stockholders' equity accounts.

Ene.		1		He bought 5,000 shares of his own stock for $20 cash per share.
Ene.		5		The directors declared a cash dividend of $2 per share payable on February 28 to shareholders of record on February 5.
Feb.		28		It paid the declared dividend on January 5.
Julio		6		He sold 1,875 of his own shares for $24 cash per share.
Ago.		22		He sold 3,125 of his treasury shares for $17 cash per share.
September		5		The directors declared a cash dividend of $2 per share payable on October 28 to shareholders of record on September 25.
Oct.		28		It paid the declared dividend on September 5.
Dic.		31		Closed credit balance of $388,000 (net income) in the Income Summary account to Retained Earnings.

Required:
1. Prepare journal entries to record each of these transactions for 2017.
2. Prepare a statement of retained earnings for the year ended December 31, 2017.
3. Prepare the stockholders' equity section of the company's balance sheet company as of December 31, 2017.

Record the purchase of 5,000 shares of your own capital stock at $20 per share.

Record the declaration of a cash dividend of $2 per share.

Record the cash dividend payment.

Record the reissue of 1,875 treasury shares at $24 cash per share.

Record the reissue of 3,125 treasury shares at $17 cash per share.

Record the declaration of a cash dividend of $2 per share.

Record the cash dividend payment.

Record the closing entry for the income summary account that has a credit balance of $388,000.

Prepare a statement of retained earnings for the year ended December 31, 2017. (Amounts to be deducted must be indicated with a minus sign.)

KOHLER CORPORATION
Statement of retained earnings
For the year ended December 31, 2017
	0
	$0

Prepare the stockholders' equity section of the company's balance sheet as of December 31, 2017.

KOHLER CORPORATION
Stockholders' Equity Section of the Balance Sheet
December 31, 2017
Total capital contributed	0
Equity of total shareholders	$0

Answer rating: 100% (QA)

Journal entries to record the transactions for Sherman Systems a Purchase of 5200 shares of its o... View the full answer