The annual report for Sneer Corporation disclosed that the company declared and paid preferred dividends in the amount of $190,000 in the current year. It also declared and paid dividends on common stock in the amount of $2.90 per share. During the current year, Sneer had 1 million common shares authorized; 390,000 shares had been issued; and 181,000 shares were in treasury stock. The opening balance in Retained Earnings was $890,000 and Net Income for the current year was $390,000.

Required:

1.

Prepare journal entries to record the declaration, and payment, of dividends on (a) preferred and (b) common stock. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

1

Record the declaration of a cash dividend of $190,000 to the preferred stockholders.

2

Record the payment of the cash dividend to the preferred stockholders.

3

Record the declaration of a cash dividend of $2.90 per share to the common stockholders payable on the shares outstanding.

4

Record the payment of the cash dividend to the common stockholders.

Using the information given above, prepare a statement of retained earnings for the year ended December 31.

3.	Prepare a journal entry to close the dividends account. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) Record the entry to close the dividends account.