Instructions

Morrow Enterprises Inc. manufactures bathroom fixtures. The stockholders equity

The owners equity in a corporation.

accounts of Morrow Enterprises Inc., with balances on January 1, 2016, are as follows:

Common stock, $20 stated value; 500,000 shares authorized, 352,000 issued	$7,040,000
Paid-In Capital in Excess of Stated ValueCommon Stock	774,400
Retained Earnings	32,153,000
Treasury Stock (25,200 shares, at cost)	478,800

The following selected transactions occurred during the year:

Jan.	22	Paid cash dividends Distribution of a corporations earnings to stockholders. of $0.05 per share on the common stock The stock outstanding when a corporation has issued only one class of stock. . The dividend had been properly recorded when declared on December 1 of the preceding fiscal year for $16,340.
Apr.	10	Issued 73,000 shares of common stock for $25 per share.
Jun.	6	Sold all of the treasury stock for $27 per share.
Jul.	5	Declared a 5% stock Shares of ownership of a corporation. dividend on common stock, to be capitalized at the market price of the stock, which is $25 per share.
Aug.	15	Issued the certificates for the dividend declared on July 5.
Nov.	23	Purchased 25,000 shares of treasury stock for $18 per share.
Dec.	28	Declared a $0.08-per-share dividend on common stock.
	31	Closed the credit balance of the income summary account, $1,223,000.
	31	Closed the two dividends accounts to Retained Earnings.

Required:

A.

Enter the January 1 balances in T accounts for the stockholders equity accounts listed.

B.

Journalize the entries to record the transactions, and post to the eight selected accounts. No post ref is required in the journal. Refer to the Chart of Accounts for exact wording of account titles.

C.

Prepare a retained earnings statement

A summary of the changes in the retained earnings in a corporation for a specific period of time, such as a month or a year.

for the year ended December 31, 2016. Enter all amounts as positive numbers. The word Less is not required.*

D.

Prepare the Stockholders Equity section of the December 31, 2016, balance sheet. Less or Deduct will automatically appear if it is required. *

* Refer to the list of Amount Descriptions provided for the exact wording of the answer choices for text entries.