Question

The equity sections for Atticus Group at the beginning of the year (January 1) and end of the year (December 31) follow. Stockholders' Equity January 1 Common stock-$4 par value, 100,000 shares authorized, 40,000 shares issued and outstanding Paid-in capital in excess of par value, common stock Retained earnings Total stockholders' equity $ 160,000 120,000 320,000 $ 600,000 Stockholders' Equity (December 31) Common stock-$4 par value, 100,000 shares authorized, 47,400 shares issued, 3,000 shares in treasury Paid-in capital in excess of par value, common stock Retained earnings ($30,000 restricted by treasury stock) $189,600 179,200 400,000 768,800 (30,000) $738,800 Less cost of treasury stock Total stockholders' equity The following transactions and events affected its equity during the year. Jan. 5 Declared a $0.50 per share cash dividend, payable on January 10. Mar. 20 Purchased treasury stock for cash. Apr. 5 Declared a $0.50 per share cash dividend, payable on April 10. July 5 Declared a $0.50 per share cash dividend, payable on July 10. July 31 Declared a 20% stock dividend when the stock's market value was $12 per share.

Answer 1

Journal Entries Date Account Title and Explaination Debit Credit Post. Ref. 20,000.00 Jan.5 Retained Earnings (40000x$0.50) Cash Dividends Payable (To record Cash Dividends Declared) $ 20,000.00 $ 20,000.00 Jan.10 Cash Dividends Payable Cash (To record Cash Dividends Paid) 20,000.00 $ 30,000.00 2 Mar.20 Treasury Stock Cash (To record Treasury Stock purchased for Cash) $ 30,000.00 $ 18,500.00 3 Apr.5 Retained Earnings (40000-3000)x$0.50 Cash Dividends Payable (To record cash dividends declared) $ 18,500.00 Apr.10 $ 18,500.00 Cash Dividends Payable Cash (To record Payment of Cash Dividends) 18,500.00

18,500.00 Jul.5 Retained Earnings (40000-3000)x$0.50 Cash Dividends Payable (To record cash dividends declared) 18,500.00 Jul. 10 $ 18,500.00 Cash Dividends Payable Cash (To record Payment of Cash Dividends) 18,500.00 Jul.31 $ 88,800.00 Retained Earnings (40000-3000)x20%x$12 Stock Dividends Payable (To record 20% stock dividend declared) S 88,800.00 Aug.14 88,800.00 Stock Dividends Payable Common Stock (37000x20%x$4) Paid In Capital In Excess of Par, Common Stock (To record issue of Stock Dividend) 29,600.00 59,200.00

Aug.14 $ 88,800.00 Stock Dividends Payable Common Stock (37000x20%x$4) Paid In Capital In Excess of Par, Common Stock (To record issue of Stock Dividend) 29,600.00 59,200.00 Oct.5 $ 22,200.00 Retained Earnings (47400-3000) x $0.50 Cash Dividends Payable (To record Cash Dividends declared) $ 22,200.00 Oct. 10 $ 22,200.00 Cash Dividends Payable Cash (To record cash Dividends Paid) $ 22,200.00