Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Problem 6 - 30 Points On January 1, 2014, Chen Corporation had the following stockholder's equity accounts. Common Stock ($5 par value, 200,000 shares issued
Problem 6 - 30 Points
On January 1, 2014, Chen Corporation had the following stockholder's equity accounts.
Common Stock ($5 par value, 200,000 shares issued and outstanding)
Paid-in Capital in Excess of Par - Common Stock
Retained Earnings
$1,000,000
200,000
840,000
During the year, the following transactions occurred.
Jan. 15 Declared a $1 cash dividend per share to stockholders of record on January 31, payable
February 15.
Feb. 15
Paid the dividend declared in January.
April 15
Declared a 10% stock dividend to stockholders of record on April 30, distributable May 15. On
April 15, the market price of the stock was $15 per share.
May 15
Issued the shares for the stock dividend.
July 1
Announced a 2-for-1 stock split. The market price per share prior to the announcement was
$17. (The new par value is $2.50.)
Dec. 1
Declared a $0.50 per share cash dividend to stockholders of record on December 15, payable
January 10, 2015.
31
Determined that net income for the year was $250,000.
Instructions
Journalize the transactions and the closing entries for net income and dividends.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started