1.)

Retained Earnings: Transactions and Statement

The stockholders equity of Cyclone Corporation at January 1 follows:

6 Percent preferred stock, $10 par value, 40,000 shares authorized;
25,000 shares issued and outstanding	$250,000
Common stock, $1 par value, 300,000 shares authorized; 80,000 shares
issued and outstanding	80,000
Paid-in capital in excess of par valueCommon stock	560,000
Retained earnings	830,000
Total Stockholders Equity	$1,720,000

The following transactions, among others, occurred during the year:

June	18	Declared a 60 percent stock dividend on all outstanding shares of common stock. The market value of the stock was $14 per share.
July	1	Issued the stock dividend declared on June 18.
Dec.	20	Declared the annual cash dividend on the preferred stock and a cash dividend of $1.60 per share on the common stock, payable on January 20 to stockholders of record on December 28.

Required

a. Prepare journal entries to record the foregoing transactions.

b. Prepare a statement of retained earnings. The net income for the year is $410,000. Do not use negative signs with your answers.

Required a. Prepare journal entries to record the foregoing transactions. General Journal Date Description Jun. 18 Debit Credit $ 0 $ 0 o o 0 0 Declared stock dividend. Jul.1 0 0 oo A o 0 Issued common shares as stock dividend. Dec.20 0 A 0 0 Dividends Payable - Common Stock Declared a cash dividend on preferred and common stock outstanding. Required a. Prepare journal entries to record the foregoing transactions. General Journal Description Debit Credit Date Jun.18 A $ 0 $ 0 o o 0 Jul. 1 0 Stock Dividends Stock Dividends Distributable Common Stock Cash Dividends Dividends Payable - Preferred Stock Dividends Payable - Common Stock o O O O 0 0 Dec.20 ooo ooo Dividends Payable - Common Stock Declared a cash dividend on preferred and common stock outstanding. b. Prepare a statement of retained earnings. The net income for the year is $410,000. Do not use negative signs with your answers. CYCLONE CORPORATION Statement of Retained Earnings For the Year Ended December 31 Retained Earnings, January 1 $ 0 Add: 0 0 Less: 0 Stock Dividends Declared 0 0 $ 0 Please answer all parts of the question. b. Prepare a statement of retained earnings. The net income for the year is $410,000. Do not use negative signs with your answers. CYCLONE CORPORATION Statement of Retained Earnings For the Year Ended December 31 Retained Earnings, January 1 $ Add: Less: $ 0 Stock Dividends Declared 0 0 $ 0 question. Net Income Retained Earnings, December 31 Cash Dividends Declared