Prepare journal entries for the following:

Shown is the capital structure prior to the transactions on Dec. 31, 1998.

Common stock, $10 par, 60,000 shares outstanding $600,000

Preferred Cumulative Stock, 5%, 100 par, 1,000 shares outstanding $100,000

ADD Paid-In Capital - Common $750,000

Retained Earnings $1,000,000

1999 1-Jan Declared a $1.00 per share cash dividend payable on the 15th to common stockholders of record on January 10th. Also, declared the divident

pertaining to preferred stockholders of record.

10-Jan DATE OF RECORD - CUT OFF DATE> DO NOTHING

12-Jan It was discovered in the records that Office Supplies Expense for last year's records was understated by $10,000. Prepare journal entry for

the correction. Corp has 30% tax bracket. Office Supplies was also overstated.

15-Jan Paid the dividend(s)

21-Jan Board of Directors decide to appropriate $100,000 of retained earnings for a legal contingency.