Retained Earnings: Transactions and Statement

The stockholders equity of Ranger Corporation at January 1 appears below:

Common stock, $10 par value, 200,000 shares authorized;
80,000 shares issued and outstanding	$800,000
Paid-in capital in excess of par value	480,000
Retained earnings	305,000

During the year, the following transactions occurred:

May	12	Declared a 15 percent stock dividend; market value of the common stock was $22 per share.
June	6	Issued the stock dividend declared on May 12.
Dec.	5	Declared a cash dividend of $1.50 per share.
	30	Paid the cash dividend declared on December 5.

Required

a. Prepare journal entries to record the foregoing transactions.

General Journal
Date	Description	Debit	Credit
May 12	AnswerStock DividendsStock Dividends DistributablePaid-in-Capital in Excess of Par ValueCommon StockCash DividendsDividends PayableCash	Answer	Answer
	Stock Dividends Distributable	Answer	Answer
	AnswerStock DividendsStock Dividends DistributablePaid-in-Capital in Excess of Par ValueCommon StockCash DividendsDividends PayableCash	Answer	Answer
	Declared stock dividend.
Jun.06	AnswerStock DividendsStock Dividends DistributablePaid-in-Capital in Excess of Par ValueCommon StockCash DividendsDividends PayableCash	Answer	Answer
	Common Stock	Answer	Answer
	Issued common shares as stock dividend.
Dec.05	AnswerStock DividendsStock Dividends DistributablePaid-in-Capital in Excess of Par ValueCommon StockCash DividendsDividends PayableCash	Answer	Answer
	AnswerStock DividendsStock Dividends DistributablePaid-in-Capital in Excess of Par ValueCommon StockCash DividendsDividends PayableCash	Answer	Answer
	Declared a cash dividend on common stock outstanding.
Dec.30	AnswerStock DividendsStock Dividends DistributablePaid-in-Capital in Excess of Par ValueCommon StockCash DividendsDividends PayableCash	Answer	Answer
	AnswerStock DividendsStock Dividends DistributablePaid-in-Capital in Excess of Par ValueCommon StockCash DividendsDividends PayableCash	Answer	Answer
	Paid cash dividend declared on Dec. 5.

b. Prepare a statement of retained earnings. Net income for the year is $275,000.

Do not use negative signs with your answers.

RANGER CORPORATION Statement of Retained Earnings For the Year Ended December 31
	Retained Earnings, January 1		Answer
	AnswerNet IncomeRetained Earnings, December 31Cash Dividends Declared		Answer
			Answer
	AnswerNet IncomeRetained Earnings, December 31Cash Dividends Declared	Answer
	Stock Dividends Declared	Answer	Answer
	AnswerNet IncomeRetained Earnings, December 31Cash Dividends Declared		Answer