On January 1, 20--, Dover Company’s retained earnings accounts had the following balances: Appropriated for printing press: $50,000 Unappropriated retained earnings: $800,000 $850,000 During the year ended December 31, 20--, Dover completed the following selected transactions: Transactions: Mar. 15 Declared a semiannual dividend of $0.30 per share on preferred stock and $0.40 per share on common stock to shareholders of record on April 5, payable on April 10. Currently, 5,000 shares of $10 par preferred stock and 30,000 shares of $2 par common stock are outstanding. Apr. 10 Paid the cash dividend. Sept. 15 Declared semiannual dividend of $0.30 per share on preferred stock and $0.40 per share on common stock to shareholders of record on October 5, payable on October 10. Oct. 10 Paid the cash dividend. Nov. 10 Board of directors declared a two-for-one common stock split. Dec. 31 Net income for 20-- was $135,000. Closed the income summary account. 31 Closed the cash dividends account. Required: 1. Prepare journal entries for the transactions. 2. Post all entries affecting the appropriated and unappropriated retained earnings accounts to T accounts. 3. Prepare a statement of retained earnings for the year ended December 31, 20--

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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On January 1, 20--, Dover Company’s retained earnings accounts had the following balances:

Appropriated for printing press: $50,000

Unappropriated retained earnings: $800,000

$850,000

During the year ended December 31, 20--, Dover completed the following selected transactions:

Transactions:
Mar.	15	Declared a semiannual dividend of $0.30 per share on preferred stock and $0.40 per share on common stock to shareholders of record on April 5, payable on April 10. Currently, 5,000 shares of $10 par preferred stock and 30,000 shares of $2 par common stock are outstanding.
Apr.	10	Paid the cash dividend.
Sept.	15	Declared semiannual dividend of $0.30 per share on preferred stock and $0.40 per share on common stock to shareholders of record on October 5, payable on October 10.
Oct.	10	Paid the cash dividend.
Nov.	10	Board of directors declared a two-for-one common stock split.
Dec.	31	Net income for 20-- was $135,000. Closed the income summary account.
	31	Closed the cash dividends account.

Required:

1. Prepare journal entries for the transactions.

2. Post all entries affecting the appropriated and unappropriated retained earnings accounts to T accounts.

3. Prepare a statement of retained earnings for the year ended December 31, 20--.

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