Accounting for various stockholders’ equity transactions (Learning Objectives 3, 5, & 7) 20–25 min.

Global Communications, Inc., began 2014 with 3 million shares of $2 par common stock issued and outstanding. Beginning Paid-in Capital in Excess of Par was $9.7 million, and Retained Earnings was $8 million. In June 2014, Global Communications, Inc., issued 120,000 shares of stock at $12 per share. In October, when the stock’s market price was $14 per share, the board of directors distributed a 5% stock dividend.

Requirements 1. Make the journal entries for the issuance of stock for cash and for the declaration and distribution of the 5% stock dividend.

2. Prepare the company’s statement of stockholders’ equity for the year ended December 31, 2014. Ignore net income.

AppendixLO1