The balance sheet of Patrick Management Consulting, Inc. at December 31, 2015, reported the following stockholders equity:

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The balance sheet of Patrick Management Consulting, Inc. at December 31, 2015, reported the following stockholders’ equity:
Stockholders' Equity
Paid-In Capital:
Common Stock—$12 Par Value; 300,000 shares authorized, 22,000 shares issued and outstanding ..................$ 264,000
Paid-In Capital in Excess of Par—Common...... 340,000
Total Paid-In Capital.............. 604,000
Retained Earnings.............. 163,000
Total Stockholders' Equity...........$ 767,000
During 2016, Patrick completed the following selected transactions:
Feb. 6 Declared a 5% stock dividend on common stock. The market value of Patrick's stock was $20 per share.
15 Distributed the stock dividend.
Jul.
29Purchased 1,800 shares of treasury stock at $20 per share.
Nov. 27 Declared a $0.20 per share cash dividend on the common stock outstanding.
Requirements
1. Record the transactions in the general journal.
2. Prepare a retained earnings statement for the year ended December 31, 2016.
Assume Patricks net income for the year was $82,000.
3. Prepare the stockholders’ equity section of the balance sheet at December 31, 2016. Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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...
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Horngrens Financial and Managerial Accounting

ISBN: 978-0133866292

5th edition

Authors: Tracie L. Nobles, Brenda L. Mattison, Ella Mae Matsumura

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