PR 12-4A Entries for selected corporate transactions Morrow Enterprises Inc. manufactures bathroom fixtures. Morrow Enterprises' stockholders' equity accounts, with balances on January 1, 2016, are as follows: Common Stock, $20 stated value (500,000 shares authorized, 375,000 shares issued) $7,500,000 Paid-In Capital in Excess of Stated Value-Common Stock Retained Earnings Treasury Stock (25,000 shares, at cost) The following selected transactions occurred during the year: $825,000 $33,600,000 $450,000 Jan. Paid cash dividends of $0.08 per share on the common stock. The dividend had been properly 22 recorded when declared on December 1 of the preceding fiscal year for $28,000. Apr. 10 June 6 Issued 75,000 shares of common stock for $24 per share. Sold all of the treasury stock for $26 per share. July 5 Aug 15 Declared a 4% stock dividend on common stock, to be capitalized at the market price of the stock, which is $25 per share. Issued shares of stock for the stock dividend declared on July 5. Nov. 23 Purchased 30,000 shares of treasury stock for $19 per share. Dec. 28 Declared a 50.10-per-share dividend on common stock. Dec 31 Closed the credit balance of the income summary account, $1,125,000. Issued shares of stock for the stock dividend declared on July 5. Purchased 30,000 shares of treasury stock for $19 per share. July 5 Aug 15 NOV 23 Declared a 4% stock dividend on common stock, to be capitalized at the market price of the stock, which is $25 per share. Dec. Declared a $0.10-per-share dividend on common stock 28 Dec Closed the credit balance of the income summary account, $1,125,000. 31 Dec Closed the two dividends accounts to Retained Earnings 31 Instructions 1. Enter the January 1 balances in T accounts for the stockholders' equity accounts listed. Also prepare T accounts for the following: Paid-In Capital from Sale of Treasury Stock; Stock Dividends Distributable; Stock Dividends; Cash Dividends. 2. Journalize the entries to record the transactions, and post to the eight selected accounts. 3. Prepare a retained earnings statement for the year ended December 31, 2016. 4. Prepare the Stockholders' Equity section of the December 31, 2016, balance sheet. " Balances, January 1 Issued common stock Net income Cash dividends Stock dividend Sale of treasury stock Purchase of treasury stock Balances, December 31 Morrow Enterprises Inc. Statement of Stockholders' Equity For the Period Ended December 31, 2016 Paid-In Capital Common Stock in Excess of Stated Value Paid-in Capital from Sale of Treasury Stock Retained Eamings Treasury Stock Total Paid-in capital: Common stock, $20 stated value Morrow Enterprises Inc. Balance Sheet December 31, 20Y6 Stockholders' Equity (500,000 shares authorized, 468,000 shares issued) $ 9,360,000 Excess of issue price over stated value 1,215,000 From sale of treasury stock Total paid-in capital Retained earnings Total Deduct treasury stock (30,000 shares at cost) Total stockholders' equity 200,000 $10,775,000