Kohler Corporation reports the following components of stockholders' equity at December 31 of the prior year. Common stock-$15 par value, 100, 000 shares authorized, 50, eee shares issued and outstanding Paid-in capital in excess of par value, common stock Retained earnings Total stockholders' equity $750,000 70,000 370,000 $ 1,190,000 During the current year, the following transactions affected its stockholders' equity accounts. January 2 Purchased 5,000 shares its own stock at $15 cash per share. January 5 Directors declared a $2 per share cash dividend payable on February 28 to the February 5 stockholders of record. Paid the dividend declared on January 5. February 28 Sold 2,500 of its July 6 treasury shares at $19 cash per share. August 22 Sold 2,500 of its treasury shares at $11 cash per share. September 5 Directors declared a $2 per share cash dividend payable on October 28 to the September 25 stockholders of record. October 28 Paid the dividend declared on September 5. December 31 Closed the $408,000 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.
Kohler Corporation reports the following components of stockholders' equity at December 31 of the prior year. Common stock-$15 par value, 100, 000 shares authorized, 50, eee shares issued and outstanding Paid-in capital in excess of par value, common stock Retained earnings Total stockholders' equity $750,000 70,000 370,000 $ 1,190,000 During the current year, the following transactions affected its stockholders' equity accounts. January 2 Purchased 5,000 shares its own stock at $15 cash per share. January 5 Directors declared a $2 per share cash dividend payable on February 28 to the February 5 stockholders of record. Paid the dividend declared on January 5. February 28 Sold 2,500 of its July 6 treasury shares at $19 cash per share. August 22 Sold 2,500 of its treasury shares at $11 cash per share. September 5 Directors declared a $2 per share cash dividend payable on October 28 to the September 25 stockholders of record. October 28 Paid the dividend declared on September 5. December 31 Closed the $408,000 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.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Kohler Corporation reports the following components of stockholders' equity at December 31 of the prior year.
Common stock-$15 par value, 100, eee shares authorized, 50, eee shares issued and outstanding
Paid-in capital in excess of par value, common stock
Retained earnings
Total stockholders' equity
$ 750,000
70,000
370,000
$ 1,190,000
During the current year, the following transactions affected Its stockholders' equity accounts.
January 2 Purchased 5,000 shares of its own stock at $15 cash per share.
January 5
Directors declared a $2 per share cash dividend payable on February 28 to the February 5 stockholders of record.
Paid the dividend declared on January 5.
February 28
Sold 2,500 of its treasury shares at $19 cash per share.
July 6
August 22
September 5
Sold 2,500 of its treasury shares at $11 cash per share.
Directors declared a $2 per share cash dividend payable on October 28 to the September 25 stockholders of record.
Paid the dividend declared on September 5.
October 28
December 31 Closed the $408,000 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.
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