Question

CALCULATOR PRINTER VERSION BACK Problem 14-01A - (Part Level Submission) (Video) on January 1, 2020, Wildhorse Corporation had the following stockholders' equity accounts Common Stock (524 par value, 63,000 shares issued and outstanding) $1,512,000 Paid-in Capital in Excess of Par-Common Stock 206,000 Retained Earnings 636,000 During the year, the following transactions occurred. Feb. 1 Declared a $2 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 $40. July 1 Declared a 15% Stock dividend to stockholders of record on July 15, distributable July 31. Only 1, the market price of the stock was $14 per share. 31 issued the shares for the stock dividend. Dec. 1 Declared a $0.30 per share dividend to stockholders of record on December 15, payable January 5, 2021. 31 Determined that net income for the year was $326,500.

Answer 1

Credit Date Feb. 1 Account title Cash dividend (63,000x$2) Dividend payable Debit 126,000 126,000 Mar. 1 126,000 Dividend payable Cash 126,000 Apr. 1 No entry required Note: Number of share issued increased to 126,000 shares, and par value decreased to $12 Jul. 1 264,600 Stock dividend (126,000x15%x$14) Common stock dividend distributable(126,000x15%x$12) Paid in capital in excess of par-Common stock 226,800 37,800 Jul. 31 226,800 Common stock dividend distributable Common stock 226,800 43,470 Cash dividend (126,000x115%)x$0.30 Dividend payable 43,470 Dec. 31 326,500 Income summary Retained earnings (To close net income) 326,500 Dec. 31 264,600 Retained earnings Stock dividend (to close stock dividend) 264,600

169,470 Dec. 31 Retained earnings Cash dividend (126,000+43,470) (to close cash dividend) 169,470