Before preparing financial statements for the current year, the chief accountant for Phil, Chris, and Caroline Company discovered the following errors in the accounts:

1. The declaration and payment of a \(\$ 25,000\) cash dividend were recorded as a debit to Interest Expense \(\$ 25,000\) and a credit to Cash \(\$ 25,000\).
2. A \(10 \%\) stock dividend ( 1,000 shares) was declared on the \(\$ 10\) par value stock when the market value per share was \(\$ 17\). The only entry made was: Retained Earnings (Dr.) \(\$ 10,000\) and Dividend Payable (Cr.) \(\$ 10,000\). The shares have not been issued.
3. A 4-for-1 stock split involving the issue of 400,000 shares of \(\$ 5\) par value common stock for 100,000 shares of \(\$ 20\) par value common stock was recorded as a debit to Retained Earnings \(\$ 2,000,000\) and a credit to Common Stock \(\$ 2,000,000\).
\section*{Instructions}
Prepare the correcting entries at December 31.