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Entries for Selected Corporate Transactions

Morrow Enterprises Inc. manufactures bathroom fixtures. The stockholders' equity accounts of Morrow Enterprises Inc., with balances on January $1,20$Y$5,$ are as follows:

Common Stock, $$10$ stated value $(900,000$ shares authorized, $600,000$ shares issued$)$ $$6,000,000$

Paid$-$In Capital in Excess of Stated Value$-$Common Stock $1,150,000$

Retained Earnings $13,620,000$

Treasury Stock $(60,000$ shares, at a cost of $$14$ per share$)840,000$

The following selected transactions occurred during the year:

Jan. $22.$ Paid cash dividends of $$0\mathrm{.}12$ per share on the common stock. The dividend had been properly recorded when declared on December $1$ of the preceding fiscal year for $$64,800.$

Apr. $10.$ Issued $115,000$ shares of common stock for $$16$ per share.

June $6.$ Sold all of the treasury stock for $$1,020,000.$

July $5.$ Declared a $4\%$ stock dividend on common stock, to be capitalized at the market price of the stock, which is $$18$ per share.

Aug. $15.$ Issued the certificates for the dividend declared on July $5.$

Nov. $23.$ Purchased $38,000$ shares of treasury stock for $$722,000.$

Dec. $28.$ Declared a $$0\mathrm{.}15-$per$-$share dividend on common stock.

$31.$ Closed the two dividends accounts to Retained Earnings.

Required:

$1.$ The January $1$ balances have been entered in T accounts for the stockholders' equity accounts. Record the above transactions in the T accounts and provide the December $31$ balance where appropriate.

Common Stock

Jan. $1$ Bal. $6,000,000$

fill in the blank $2$

fill in the blank $4$

Dec. $31$ Bal. fill in the blank $5$

Paid$-$In Capital in Excess of Stated Value$-$Common Stock

Jan. $1$ Bal. $1,150,000$

fill in the blank $7$

fill in the blank $9$

Dec. $31$ Bal. fill in the blank $10$

Retained Earnings

fill in the blank $12$

Jan. $1$ Bal. $13,620,000$

fill in the blank $14$

Dec. $31$ Bal. fill in the blank $15$

Treasury Stock

Jan. $1$ Bal. $840,000$

fill in the blank $17$

fill in the blank $19$

Dec. $31$ Bal. fill in the blank $20$

Paid$-$In Capital from Sale of Treasury Stock

fill in the blank $22$

Stock Dividends Distributable

fill in the blank $24$

fill in the blank $26$

Stock Dividends

fill in the blank $28$

fill in the blank $30$

Cash Dividends

fill in the blank $32$

fill in the blank $34$

$2.$ Journalize the entries to record the transactions. If an amount box does not require an entry, leave it blank.

Jan. $22.$ Paid cash dividends of $$0\mathrm{.}12$ per share on the common stock. The dividend had been properly recorded when declared on December $1$ of the preceding fiscal year for $$64,800.$

Date Account Debit Credit

Jan. $22$

fill in the blank $36$

fill in the blank $37$

fill in the blank $39$

fill in the blank $40$

Apr. $10.$ Issued $115,000$ shares of common stock for $$16.$

Date Account Debit Credit

Apr. $10$

fill in the blank $42$

fill in the blank $43$

fill in the blank $45$

fill in the blank $46$

fill in the blank $48$

fill in the blank $49$

June $6.$ Sold all of the treasury stock for $$1,020,000.$

Date Account Debit Credit

June $6$

fill in the blank $51$

fill in the blank $52$

fill in the blank $54$

fill in the blank $55$

fill in the blank $57$

fill in the blank $58$

July $5.$ Declared a $4\%$ stock dividend on common stock, to be capitalized at the market price of the stock, which is $$18$ per share.

Date Account Debit Credit

July $5$

fill in the blank $60$

fill in the blank $61$

fill in the blank $63$

fill in the blank $64$

fill in the blank $66$

fill in the blank $67$

Aug. $15.$ Issued the certificates for the dividend declared on July $5.$

Date Account Debit Credit

Aug. $15$

fill in the blank $69$

fill in the blank $70$

fill in the blank $72$

fill in the blank $73$

Nov. $23.$ Purchased $38,000$ shares of treasury stock for $$722,000.$

Date Account Debit Credit

Nov. $23$

fill in the blank $75$

fill in the blank $76$

fill in the blank $78$

fill in the blank $79$

Dec. $28.$ Declared a $$0\mathrm{.}15-$per$-$share dividend on common stock.

Date Account Debit Credit

Dec. $28$

fill in the blank $81$

fill in the blank $82$

fill in the blank $84$

fill in the blank $85$

Dec. $31.$ Closed the two dividends accounts to Retained Earnings.

Date Account Debit Credit

Dec. $31$

fill in the blank $87$

fill in the blank $88$

fill in the blank $90$

fill in the blank $91$

fill in the blank $93$

fill in the blank $94$

$3.$ Prepare a retained earnings statement for the year ended December $31,20$Y$5.$ Assume that Morrow Enterprises Inc. had net income for the year ended December $31,20$Y$5,$ of $$14,165,000.$

Morrow Enterprises Inc.

Retained Earnings Statement

For the Year Ended December $31,20$Y$5$

$fill in the blank $96$

$fill in the blank $98$

Dividends:

fill in the blank $100$

fill in the blank $102$

fill in the blank $104$

$fill in the blank $106$

$4.$ Prepare the Stockholders' Equity section of the December $31,20$Y$5,$ balance sh