Knapp Industries began business on January 1, 2021 by Issuing all of its 2,100,000 authorized shares of Its $1 par value common stock for $40 per share. On June 30, Knapp declared a cash dividend of $1.75 per share to stockholders of record on July 31. Knapp paid the cash dividend on August 30. On November 1, Knapp reacquired 420,000 of its own shares of stock for $45 per share. On December 22, Knapp resold 210,000 of these shares for $51 per share. Required: a. Prepare all of the necessary Journal entries to record the events described above. b. Prepare the stockholders' equity section of the balance sheet as of December 31, 2021 assuming that the net income for the year was $13,000,000.

Knapp Industries began business on January 1, 2021 by Issuing all of its 2,100,000 authorized shares of Its $1 par value common stock for $40 per share. On June 30, Knapp declared a cash dividend of $1.75 per share to stockholders of record on July 31. Knapp paid the cash dividend on August 30. On November 1, Knapp reacquired 420,000 of its own shares of stock for $45 per share. On December 22, Knapp resold 210,000 of these shares for $51 per share. Required: a. Prepare all of the necessary Journal entries to record the events described above. b. Prepare the stockholders' equity section of the balance sheet as of December 31, 2021 assuming that the net income for the year was $13,000,000.

Intermediate Accounting: Reporting And Analysis

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 10MC

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Knapp Industries began business on January 1, 2021 by Issuing all of its 2,100,000 authorized shares of Its $1 par value common stock
for $40 per share. On June 30, Knapp declared a cash dividend of $1.75 per share to stockholders of record on July 31. Knapp paid the
cash dividend on August 30. On November 1, Knapp reacquired 420,000 of its own shares of stock for $45 per share. On December
22, Knapp resold 210,000 of these shares for $51 per share.
Required:
a. Prepare all of the necessary Journal entries to record the events described above.
b. Prepare the stockholders' equity section of the balance sheet as of December 31, 2021 assuming that the net income for the year
was $13,000,000.
Complete this question by entering your answers in the table below.
Required A Required B
Prepare the stockholders' equity section of the balance sheet as of December 31, 2021 assuming that the net income for the
year was $13,000,000.
Knapp Industries
Stockholders' Equity
Balance Sheet as of December 31, 2021
Total Stockholders' Equilty
< Required A
Required B >

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