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Alex Corporation reports the following components of stockholders' equity at December 31 of the prior year. Common stock-$25 par value, 70,000 shares authorized, 42,000 shares issued and outstanding Paid-in capital in excess of par value, common stock $1,050,000 84,000 382,000 Retained earnings Total stockholders' equity $1,516,000 During the current year, the following transactions affected its stockholders' equity accounts. January 2 Purchased 4,200 shares of its own stock at $25 cash per share. Directors declared a $1.50 per share cash dividend payable on February 28 to the February 9 stockholders of January 7 record. Paid the dividend declared on January 7. February 28 July 9 August 27 Sold 1,680 of its treasury shares at $30 cash per share. Sold 2,100 of its treasury shares at $21 cash per share. September 9 Directors declared a $2 per share cash dividend payable on October 22 to the September 23 stockholders of record. October 22 Paid the dividend declared on September 9. December 31 Closed the $64,000 credit balance (from net income) in the Income Summary account to Retained Earnings. Required: 1. Prepare journal entries to record each of these transactions. 2. Prepare a statement of retained earnings for the current year ended December 31. 3. Prepare the stockholders' equity section of the balance sheet as of December 31 of the current year.

Alex Corporation reports the following components of stockholders' equity at December 31 of the prior year. Common stock-$25 par value, 70,000 shares authorized, 42,000 shares issued and outstanding Paid-in capital in excess of par value, common stock $1,050,000 84,000 382,000 Retained earnings Total stockholders' equity $1,516,000 During the current year, the following transactions affected its stockholders' equity accounts. January 2 Purchased 4,200 shares of its own stock at $25 cash per share. Directors declared a $1.50 per share cash dividend payable on February 28 to the February 9 stockholders of January 7 record. Paid the dividend declared on January 7. February 28 July 9 August 27 Sold 1,680 of its treasury shares at $30 cash per share. Sold 2,100 of its treasury shares at $21 cash per share. September 9 Directors declared a $2 per share cash dividend payable on October 22 to the September 23 stockholders of record. October 22 Paid the dividend declared on September 9. December 31 Closed the $64,000 credit balance (from net income) in the Income Summary account to Retained Earnings. Required: 1. Prepare journal entries to record each of these transactions. 2. Prepare a statement of retained earnings for the current year ended December 31. 3. Prepare the stockholders' equity section of the balance sheet as of December 31 of the current year.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Alex Corporation reports the following components of stockholders' equity at December 31 of the prior year. Common stock-$25 par value, 70,000 shares authorized, 42,000 shares issued and outstanding $ 1,050,000 Paid-in capital in excess of par value, common stock Retained earnings 84,000 382,000 Total stockholders' equity $ 1,516,000 During the current year, the following transactions affected its stockholders' equity accounts. January 2 Purchased 4,200 shares of its own stock at $25 cash per share. January 7 Directors declared a $1.50 per share cash dividend payable on February 28 to the February 9 stockholders of record. Paid the dividend declared on January 7. February 28 July 9 August 27 Sold 1,680 of its treasury shares at $30 cash per share. Sold 2,100 of its treasury shares at $21 cash per share. September 9 Directors declared a $2 per share cash dividend payable on October 22 to the September 23 stockholders of record. October 22 Paid the dividend declared on September 9. December 31 Closed the $64,000 credit balance (from net income) in the Income Summary account to Retained Earnings. Required: 1. Prepare journal entries to record each of these transactions. 2. Prepare a statement of retained earnings for the current year ended December 31. 3. Prepare the stockholders' equity section of the balance sheet as of December 31 of the current year. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare journal entries to record each of these transactions. No Date General Journal Debit Credit January 02 105,000 Treasury stock, common Cash 105,000 January 07 56,700 Common dividend payable Cash 56,700 February 28 56,700✔✔ Common dividend payable Cash 56,700 July 09 Cash 50,400 Treasury stock, common 42,000 Paid-in capital, treasury stock August 27 Cash 42,000 x Paid-in capital, treasury stock 8,400 Paid-in capital in excess of par value, common stock 2,100 x Treasury stock, common September 09 Common dividend payable Cash October 22 Common dividend payable Cash December 31 Income summary 1 2 3 4 5 6 7 8 Retained earnings Retained earnings Common stock dividend distributable < Required 1 33 XX 33 ››› ✔ ✔ ›› ** Required 2 > ✓ XX 33 *** x 83,160 83,160 64,000 139,860 8,400✔✔ 52,500 83,160 83,160 64,000 139,860 x
Transcribed Image Text:Alex Corporation reports the following components of stockholders' equity at December 31 of the prior year. Common stock-$25 par value, 70,000 shares authorized, 42,000 shares issued and outstanding $ 1,050,000 Paid-in capital in excess of par value, common stock Retained earnings 84,000 382,000 Total stockholders' equity $ 1,516,000 During the current year, the following transactions affected its stockholders' equity accounts. January 2 Purchased 4,200 shares of its own stock at $25 cash per share. January 7 Directors declared a $1.50 per share cash dividend payable on February 28 to the February 9 stockholders of record. Paid the dividend declared on January 7. February 28 July 9 August 27 Sold 1,680 of its treasury shares at $30 cash per share. Sold 2,100 of its treasury shares at $21 cash per share. September 9 Directors declared a $2 per share cash dividend payable on October 22 to the September 23 stockholders of record. October 22 Paid the dividend declared on September 9. December 31 Closed the $64,000 credit balance (from net income) in the Income Summary account to Retained Earnings. Required: 1. Prepare journal entries to record each of these transactions. 2. Prepare a statement of retained earnings for the current year ended December 31. 3. Prepare the stockholders' equity section of the balance sheet as of December 31 of the current year. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare journal entries to record each of these transactions. No Date General Journal Debit Credit January 02 105,000 Treasury stock, common Cash 105,000 January 07 56,700 Common dividend payable Cash 56,700 February 28 56,700✔✔ Common dividend payable Cash 56,700 July 09 Cash 50,400 Treasury stock, common 42,000 Paid-in capital, treasury stock August 27 Cash 42,000 x Paid-in capital, treasury stock 8,400 Paid-in capital in excess of par value, common stock 2,100 x Treasury stock, common September 09 Common dividend payable Cash October 22 Common dividend payable Cash December 31 Income summary 1 2 3 4 5 6 7 8 Retained earnings Retained earnings Common stock dividend distributable < Required 1 33 XX 33 ››› ✔ ✔ ›› ** Required 2 > ✓ XX 33 *** x 83,160 83,160 64,000 139,860 8,400✔✔ 52,500 83,160 83,160 64,000 139,860 x
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