On January 1, 1997, Wirth Corporation had the following stockholders' equity accounts:

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.
Apr. 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 \(\$ 13\) 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 \(\$ 15\). (The new par value is \(\$ 5\).)
Dec. 1 Declared a \(\$ .50\) per share cash dividend to stockholders of record on December 15, payable January 10, 1998 .
31 Determined that net income for the year was \(\$ 220,000\).
\section*{Instructions}

(a) Journalize the transactions and the closing entry for net income.

(b) Enter the beginning balances and post the entries to the stockholders' equity accounts. (Note: Open additional stockholders' equity accounts as needed.)

(c) Prepare a stockholders' equity section at December 31.

Transcribed Image Text:

Common Stock ($10 par value, 80,000 shares issued and outstanding) Paid-in Capital in Excess of Par Value Retained Earnings $800,000 200,000 540,000