Problem 8-4 (Part Level Submission)

The stockholders equity accounts of Blue Spruce Corp. on January 1, 2017, were as follows.

Preferred Stock (7%, $100 par noncumulative, 5,000 shares authorized) $300,000

Common Stock ($4 stated value, 300,000 shares authorized) 1,000,000

Paid-in Capital in Excess of Par ValuePreferred Stock 15,000

Paid-in Capital in Excess of Stated ValueCommon Stock 480,000

Retained Earnings 685,500

Treasury Stock (5,000 common shares) 40,000

During 2017, the corporation had the following transactions and events pertaining to its stockholders equity.

Feb. 1 Issued 5,000 shares of common stock for $30,000.

Mar. 20 Purchased 1,000 additional shares of common treasury stock at $7 per share.

Oct. 1 Declared a 7% cash dividend on preferred stock, payable November 1.

Nov. 1 Paid the dividend declared on October 1.

Dec. 1 Declared a $0.85 per share cash dividend to common stockholders of record on December 15, payable December 31, 2017.

Dec. 31 Paid the dividend declared on December 1.

(a)-(b) Your answer is correct. (a) Prepare a tabular summary that includes the January 1, 2017, balances. Do not include the beginning balance in Retained Earnings in the tabular summary. (b) Record the 2017 transactions in the tabular summary. (Round answers to O decimal places, e.g. 5, 275. Il a transaction causes a decrease in Assets, Liabilities or Stockholders' Equity, place a negative sign (or parentheses) in front of the amount entered for the particular Asset, Liability or Equity item that was reduced.) Assets = Liabilities Stockholders' Equity Retained Earnings - Expense - Cash = + Paid-in-Capital + Common Stock + PIC in Excess of Stated Value Com. + Pref. Stock J 1,000,000 480,000 300,000 Div. Pay. Revenue Dividend + PIC in Excess of Par Value Pref. - Treasury Stock + 15,000 - 40,000 (a) Bal. T 20,000 Oct. 1 Nov. 1 Dec. 1 Dec. 31 -211,69 -211,650 (C) Prepare the stockholders' equity section of the balance sheet at December 31, 2017. Include 2017 net income of $313,000 as an increase to the January 1, 2017, Retained Earnings. BLUE SPRUCE CORP. Partial Balance Sheet December 31, 2017