Identifying and Analyzing Financial Statement Effects of Dividends The stockholders' equity of Kinney Company at December 31, 2013, is shown below.

The following transactions, among others, occurred during 2014: Apr. 1 Declared and issued a 100% stock dividend on all outstanding shares of common stock. The market value of the stock was $11 per share. Dec. 7 Declared and issued a 4% stock dividend on all outstanding shares of common stock. The market value of the stock was $14 per share. Dec. 20 Declared and paid (1) the annual cash dividend on the preferred stock and (2) a cash dividend of 80 cents per common share.

(a) Use the financial statement effects template to indicate the effects of these separate transactions.

(b) Compute retained earnings for 2014 assuming that the company reports 2014 net income of $262,000.

5% preferred stock, $100 par value, 10,000 shares authorized; 5,000 shares issued and $500,000 outstanding Common stock, $5 par value, 200,000 shares authorized 60,000 shares issued and 300,000 outstanding Paid-in capital in excess of par value 40,000 preferred stock Paid-in capital in excess of par value 300,000 common stock 656,000 Retained earnings Total stockholders' equity $1,796,000