Problem 14-2APrepare a retained earnings statement for the year. (List items that increase retained earnings first.)

The stockholders' equity accounts of Karp Company at January 1, 2017, are as follows Preferred stock, 6%, $50 par $585,000 Common Stock, $7 par 1,109,500 Paid-in Capital in Excess of Par-Preferred Stock 202,000 Paid-in Capital in Excess of Par-Common Stock 305,500 Retained Earnings 784,500 There were no dividends in arrears on preferred stock. During 2017, the company had the following transactions and events. July 1 Declared a $0.60 cash dividend per share on common stock Aug. 1 Discovered $21,000 understatement of depreciation expense in 2016. (Ignore income taxes.) Sept. 1 Paid the cash dividend declared on July 1 Dec. 1 Declared a 15% stock dividend on common stock when the market price of the stock was $15 per share 15 Declared a 6% cash dividend on preferred stock payable January 15, 2018 31 Determined that net income for the year was $309,000 31 Recognized a $210,000 restriction of retained earnings for plant expansion. Journalize the transactions, events, and closing entries for net income and dividends. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.) nt Titles and Explanation Debit Credit (To close net income) (To close cash dividends) (To close stock dividends)