I have attached the fillable worksheet that goes with this and have highlighted what I cannot figure out and the worksheet displays ?wrong? on the incorrect answers. Morris Corporation is publicly owned, and its shares are traded on a national stock exchange. Morris has 16,000 shares of $2 stated value common stock authorized. Only 75% of these shares have been issued, and of the shares issued, only 11,000 are outstanding. On December 31, 2010, the Stockholder's Equity section revealed that the balance in Paid-In Capital in Excess of Stated Value was $416,000, and the Retained Earnings balance was $110,000. Treasury stock was purchased at an average of $37.50 per share: During 2011, Morris had the following transactions: Jan. 15 Morris issued, at $55 per share, 800 shares of $50 par, 5% cumulative preferred stock; 2,000 shares are authorized. Feb. 1 Morris sold 1,500 shares of newly issued $2 stated value common stock at $42 per share. Mar. 15 Morris declared a cash dividend on common stock of $0.15 per share, payable on April 30 to all stockholders of record on April 1. April 15 Morris reacquired 200 shares of its common stock for $43 per share. Morris uses the cost method to account for treasury stock. April 30 Morris paid dividends. April 30 Employees exercised 1,000 options granted in 2006 under a fixed stock option plan. When the options were granted, each option entitled the employee to purchase one share of common stock for $50 per share. The share price on the grant date was $51 per share. On April 30, when the market price was $55 per share, Morris issued new shares to the employees. The fair value of the options at the grant date was $6. May 1 Morris declared a 10% stock dividend to be distributed on June 1 to stockholder?s of record on May 7. The market price of the common stock was $55 per share on May 1 (before stock dividend). (Assume that treasury shares do not participate in stock dividends). May 31 Morris sold 150 treasury shares reacquired on April 15 and an additional 200 shares costing $7,500 that had been on hand since the beginning of the year. The selling price was $57 per share. June 1 Morris distributed the stock dividend. Sept. 15 The semiannual cash dividend on common stock was declared, amounting to $0.15 per share. Morris also declared the yearly dividend on preferred stock. Both are payable on October 15 to stockholders of record on October 1. Oct. 15 Morris paid dividends. Net income for 2011 was $50,000. Assume that revenues and expenses were closed to a temporary account, Income Summary. Use this account to complete the closing process. Instructions: 1.Compute the number of shares and dollar amount of treaury stock at the beginning of 2011. 2.Make the necessary journal entries to record the transactions in 2011 relating to stockholder's equity. 3.Prepare the Stockholder's Equity section of Morris Corporation's December 31, 2011, balance sheet.

13-58 Name: Crystal Jones To enter the journal entries, enter the appropriate account titles in the shaded cells in columns C and D, and the appropriate amounts in the shaded cells in columns G and I. 1. Authorized shares 16,000 0.75 12,000 11,000 1,000 $2.00 $2,000 Issued shares Less: Outstanding shares Treasury shares Average purchase price per share of treasury stock Total dollar amount of treasury stock 2. Journal Entries Jan. 15 Cash 44,000 Preferred Stock Paid-in Capital in Excess of Par - Preferred Feb. 1 40,000 4,000 Cash 63,000 Common Stock Paid-in Capital in Excess of Stated Value - Common Mar. 15 Dividends (Retained Earnings) Dividends Payable Apr. 15 Dividends Payable Cash Apr. 30 Wrong Cash Paid-in Capital from Stock Options - Common Stock Common Stock Paid-in Capital in Excess of Stated Value - Common May 1 May 31 Dividends (Retained Earnings) Stock Dividends Distributable Paid-in Capital in Excess of Stated Value - Common 2,472 Wrong Treasury Stock Cash Apr. 30 3,000 60,000 8,600 Wrong 2,472 Wrong 2,247 50,000 6,000 2,000 54,000 Wrong 4,494 Wrong Wrong Cash 225 225 19,950 Common Stock Paid-in Capital in Excess of Stated Value - Common 13,950 June 1 Stock Dividends Distributable Common Stock Sept. 15 Dividends (Retained Earnings) Dividends Payable - Preferred Dividends Payable - Common 4,247 Oct. 15 Dividends Payable - Preferred Dividends Payable - Common Cash 2,000 2,247 Dec. 31 Income Summary Common Stock Dec. 31 3. 2,472 8,600 Retained Earnings Dividends (Retained Earnings) Wrong 1,700 Wrong 8,550 2,000 2,247 4,247 Wrong Wrong 2,247 Wrong 110,000 82,000 Stockholders' Equity Contributed capital: 5% preferred stock, $50 par, cumulative, 2000 shares authorized, 800 shares outstanding Paid-in capital in excess of par - preferred stock Common stock, $2 stated value, 16,000 shares authorized, 15,830 issued, 14,980 outstanding Paid-in capital in excess of stated value - common stock Paid in capital from treasury stock Total contributed capital Retained earnings Total contributed capital and retained earnings Less: Treasury stock at cost (850 shares) Total Stockholders' equity Wrong Wrong Wrong Wrong $40,000 4,000 31,660 8,600 31,875 $116,135 98,040 $214,175 16,575 $197,600