Prepare dividend entries, prepare a stockholders equity section, and calculate ratios.

(LO 4, 5, 6)

P11-4BOn January 1, 2014, Lamar Corporation had these stockholders equity accounts.Common Stock ($20 par value, 80,000 shares issued and outstanding)$1,600,000

Paid-in Capital in Excess of Par Value240,000

Retained Earnings750,000

During the year, the following transactions occurred.

Feb.1Declared a $1.00 cash dividend per share to stockholders of record on February 15, payable March 1.

Mar.1Paid the dividend declared in February.

July1Declared a 15% stock dividend to stockholders of record on July 15, distributable July 31. On July 1, the market price of the stock was $25 per share.

31Issued the shares for the stock dividend.

Dec.1Declared a $1 per share cash dividend to stockholders of record on December 15, payable January 5, 2017.

31Determined that net income for the year was $500,000. The market price of the common stock on this date was $32.

Instructions

(a)Journalize the transactions. (Include entries to close net income and dividends to Retained Earnings.)

(c)Total stockholders equity $2,918,000

(b)Enter the beginning balances and post the entries to the stock-holders equity T-accounts. (Note: Open additional stockholders equity accounts as needed.)(c)Prepare the stockholders equity section of the balance sheet at December 31, 2017.