Question

Accounting (24th) warren/reeve/duchac - page 616 PR 13-4A

Entries for selected corporate transaction Tolbert Enterprises Inc. manufactures bathroom fixtures. The stockholders' equity accounts of Tolbert enterprises Inc., withbalances on January 1, 2012 are as follows:

common stock, $10 stated value (600,000 shares authorized, 400,000 shares issued) -$4,000,000

Paid-In capital in Excess of Stated Value - $750,000

Retained Earnings - $ 9,150,000

Treasury stock (40,000 shares, at cost) - $600,000

The following selected transactions occurred during the year:

Jan 4. paid cash dividends of $0.13 per share on the common stock. The dividend had been properly recorded when declared on December 1 of the preceding fiscal year for$46,800

Apr 3. Issued $75,000 shares of comon stock for $1,200,000

June 6. Sold all of the treasury stock for $725,000

July 1. Declared a 4% stock dividend on common stock, to be capitalized at the market price of the stock, which is $18 per share.

Aug 15. Issued the certificates for the dividend declared on July 1.

Nov 10. Purchased 25,000 shares of treasury stock for $500,000

Dec 27. Declared a $0.16-per-share dividend on common stock
31. Closed the credit balance of the income summary account, $950,000
31. Closed the two dividends accounts to Retained Earnings
1)
Enter the January 1 balances in T accounts for the stockholders' equity accounts listed. Also prepare T accounts for the following: paid-In Capital from sale oftreasury stock; stock dividends distributable; stock dividends; cash dividends
2) Journalize the entries to record the transactions, and post to the eight selected accounts.
3) prepare a retained earnings statement for the year ended December 31, 2012
4) Prepare the stockholders' Equity section of the December 31, 2012, balance sheet.

Answer 1

1. T-Accounts:

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2.Journal entries:

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3.Retained earnings statement:

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4.Stockholder's equity section: