On January 1, 2020, Geffrey Corporation had the following stockholders’ equity accounts. Prepare dividend entries and stockholders’ equity section. Common Stock ($20 par value, 60,000 shares issued and outstanding) $1,200,000 Paid-in Capital in Excess of Par—Common Stock 200,000 Retained Earnings 600,000 During the year, the following transactions occurred. Feb. 1 Declared a $1 cash dividend per share to stockholders of record on February 15, payable March 1. Mar. 1 Paid the dividend declared in February. Apr. 1 Announced a 2-for-1 stock split. Prior to the split, the market price per share was $36. July 1 Declared a 10% stock dividend to stockholders of record on July 15, distributable July 31. On July 1, the market price of the stock was $13 per share. 31 Issued the shares for the stock dividend. Dec. 1 Declared a $0.50 per share dividend to stockholders of record on December 15, payable January 5, 2021. 31 Determined that net income for the year was $350,000. Instructions a. Journalize the transactions and the closing entries for net income and dividends. 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.

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter16: Retained Earnings And Earnings Per Share

Section: Chapter Questions

Problem 1MC: Cash dividends on the 10 par value common stock of Garrett Company were as follows: The 4th-quarter...

Related questions

Question

On January 1, 2020, Geffrey Corporation had the following stockholders’ equity accounts.

Prepare dividend entries and stockholders’ equity section.

Common Stock ($20 par value, 60,000 shares issued and outstanding)	$1,200,000
Paid-in Capital in Excess of Par—Common Stock	200,000
Retained Earnings	600,000

During the year, the following transactions occurred.

Feb.	1	Declared a $1 cash dividend per share to stockholders of record on February 15, payable March 1.
Mar.	1	Paid the dividend declared in February.
Apr.	1	Announced a 2-for-1 stock split. Prior to the split, the market price per share was $36.
July	1	Declared a 10% stock dividend to stockholders of record on July 15, distributable July 31. On July 1, the market price of the stock was $13 per share.
	31	Issued the shares for the stock dividend.
Dec.	1	Declared a $0.50 per share dividend to stockholders of record on December 15, payable January 5, 2021.
	31	Determined that net income for the year was $350,000.

a. Journalize the transactions and the closing entries for net income and dividends.
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.

Expert Solution