Question

On January 1, 2020, Carla Vista Corporation had the following stockholders’ equity accounts.

Common Stock ($26 par value, 59,500 shares issued and outstanding)		$1,547,000
Paid-in Capital in Excess of Par—Common Stock		191,000
Retained Earnings		564,000

During the year, the following transactions occurred.

Feb. 1		Declared a $3 cash dividend per share to stockholders of record on February 15, payable March 1.
Mar. 1		Paid the dividend declared in February.
Apr. 1		Announced a 2-for-1 stock split. Prior to the split, the market price per share was $35.
July 1		Declared a 10% stock dividend to stockholders of record on July 15, distributable July 31. On July 1, the market price of the stock was $15 per share.
31		Issued the shares for the stock dividend.
Dec. 1		Declared a $0.50 per share dividend to stockholders of record on December 15, payable January 5, 2021.
31		Determined that net income for the year was $308,000.

Journalize the transactions and the closing entries for net income and dividends. 

Answer 1

Date	Account titles & Explanations					Debit	Credit
1-Feb	Cash dividend					178,500
	dividends payable		(59500*3)				178,500
1-Mar	Dividends payable					178500
	Cash						178500
1-Apr	no entry	(119,000 shares at $13 par value)
1-Jul	Stock dividend		(11900*15)			178500
	Stock dividend distributable			(11900*13)			154,700
	paid in capital in excess of par -CS						23800
	(119,000*10%=11900 shares)
31-Jul	Stock dividend distributable					154700
	common stock						154700
1-Dec	Cash dividend					59500
	dividends payable						59500
	(130900*.5)
31-Dec	income summary					308,000
	retained earnings						308,000
31-Dec	retained earnings					178,500
	Stock dividend						178,500
31-Dec	Retained earnings					238,000
	cash dividend						238,000