Question

- Calculator Entries for Selected Corporate Transactions Morrow Enterprises Inc, manufactures bathroom fixtures. The stockholders' equity accounts of Morrow Enterprises Inc., with balances on January 1, 2015, are as follows: Common Stock, $10 stated value (800,000 shares authorized, 520,000 shares issued) $5,200,000 Paid-In Capital in Excess of Stated Value-Common Stock 1,000,000 Retained Earnings 11,800,000 Treasury Stock (52,000 shares, at cost) 728,000 The following selected transactions occurred during the year Jan. 22. Paid cash dividends of $0.13 per share on the common stock. The dividend had been property recorded when declared on December 1 of the preceding fiscal year for $60,840. Apr. 10. Issued 100,000 shares of common stock for $1,600,000 June 6. Sold all of the treasury stock for $884,000. July 5. Declared a 5% stock dividend on common stock, to be capitalized at the market price of the stock, which is $10 per share. Aug. 15. Issued the certificates for the dividend declared on July 5. Nov. 23. Purchased 33,000 shares of treasury stock for $627,000. Dec. 28. Declared a $0.16-per-share dividend on common stock. 31. Closed the credit balance of the income summary account, $12,272,000. 31. Closed the two dividends accounts to Retained Earnings. Required: accounts for the stockholders' equity accounts. Record the above transactions in the Taccounts and provide the December 31 balance where 1. The January 1 balances have been entered in appropriate Common Stock Dan 1 Bal. Dec. 31 Bal. Pald-In Capital in Excess of stated Value-Common Stock an. 1 Bal 1,000,000 Dec. 31 Bal Retained Earnings 11,800,000 Previous

Answer 1

Credit($) Debit($) 60.840 1 [(520,000- 52,000)*$0.13] 60,840 1,600,000 1,000,000 600,000 (100000*$16) (100000*$10) (100000*56) 884,000 728,000 156,000 ($14*52000) [($17-14)*52000] 558,000 310,000 248,000 [(520000 - 100000)*5%*$18] [(520000 - 100000)*5%*$10] [(520000 + 100000)*5%*$8] Date General Journal Jan-22 Dividend Payable Cash [To record the dividend paid] Apr-10 Cash Common Stock Paid In capital in Excess-Common Stock [To record the issuence of shares Jun-06 Cash Treasury Stock Paid in Capital from sale of Treasury Stock [To record the sale of treasury stock] Jul-05 Stock Dividends Stock Dividends Distributable Paid In capital in Excess-Common Stock [To record the stock dividend] Aug-15 Stock Dividends Distributable Common Stock [To record the issvence of certificates for dividend] Nov-23 Treasury Stock Cash [To record the purchase of treasury stock] Dec-28 Cash Dividends Dividend Payable [To record the dividend declared] Dec-31Income Summary Retained Earnings [To record the close the income summary account] Dec-31 Retained Earnings Stock Dividends Cash Dividends [To record dividend accounts closed] 310,000 310,000 627.000 1 627,000 98.800 [(520000 + 100000 + 31000-33000 )*$0.16] 98.800 12.272.000 12.272.000 656.800 558,000 98.800

Common Stock Jan. 01 Bal Apr. 10 Aug. 15 Dec. 31 Bal 5,200,000 1,000,000 310,000 6,510,000 Paid in Capital In Excess of Started value-Common Stock Jan. 01 Bal 1,000,000 Apr. 10 600,000 Jul. 05 248,000 Dec. 31 Bal 1,848,000) Dec. 31 Bal Reatained Earnings 656,800 Jan. 01 Bal Dec. 31 Dec. 31 Bal 11,800,000 12,272,000 23,415,200 Bal 728,000 Jan. 01 Nov. 23 Dec. 31 Treasury Stock 728,000 Jun. 06 627,000 627,000 Bal Paid in Capital from sale of Treasury Stock Jun. 06 156,000 156,000

Stock Dividends Distributable 310,000 Jul. 05 Aug. 15 310,000 Stock Dividends 558,000 Dec. 31 Jul. 05 558,000 Cash Dividends 98,800 Dec. 31 Dec. 28 98,800