The Annapolis Corporation's stockholders' equity accounts have the following balances as of January 1, 2018: 12% preferred stock, cumulative, $50 par (10,000 shares issued and outstanding) $500,000 Common stock, $10 par (100,000 shares issued and outstanding) 1,000,000 Additional paid-in capital: common 1,000,000 Retained earnings 3,750,000 Total stockholders' equity $6,250,000 Annapolis engaged in the following dividend transactions during 2018, 2019, and 2020: 2018: Dividends are in arrears for 2016 and 2017. On December 1, 2018, the annual cash dividend plus the dividends in arrears were declared on the preferred stock. In addition, a $1.50 per share dividend was declared on the common stock. The dividends were paid on December 31, 2018. 2019: On December 1, 2019, the annual cash dividend on the preferred stock was declared. The dividend was paid on December 31, 2019. On December 10, a 30% stock dividend was declared on the common stock, distributable on January 25, 2020. The market price per share for the common stock on December 10, 2019, was $28. 2020: On January 25, 2020, the stock dividend declared on December 10, 2019, was issued. On December 1, the annual cash dividend on the preferred stock was declared; it is payable on January 15, 2021. In addition, on December 1, a 10% stock dividend was declared on the common stock, distributable on January 20, 2021. The market price per share for the common stock on December 1, 2020, was $23. No other stock transactions took place during 2018, 2019, or 2020. Required: Prepare the entries to record the dividend transactions for 2018, 2019, and 2020. (Do not record any transactions for 2021.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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The Annapolis Corporation's stockholders' equity accounts have the following balances as of January 1, 2018:


12% preferred stock, cumulative, $50 par (10,000 shares issued and outstanding)	$500,000
Common stock, $10 par (100,000 shares issued and outstanding)	1,000,000
Additional paid-in capital: common	1,000,000
Retained earnings	3,750,000
Total stockholders' equity	$6,250,000

Annapolis engaged in the following dividend transactions during 2018, 2019, and 2020:

2018:	Dividends are in arrears for 2016 and 2017. On December 1, 2018, the annual cash dividend plus the dividends in arrears were declared on the preferred stock. In addition, a $1.50 per share dividend was declared on the common stock. The dividends were paid on December 31, 2018.
2019:	On December 1, 2019, the annual cash dividend on the preferred stock was declared. The dividend was paid on December 31, 2019.
	On December 10, a 30% stock dividend was declared on the common stock, distributable on January 25, 2020. The market price per share for the common stock on December 10, 2019, was $28.
2020:	On January 25, 2020, the stock dividend declared on December 10, 2019, was issued.
	On December 1, the annual cash dividend on the preferred stock was declared; it is payable on January 15, 2021.
	In addition, on December 1, a 10% stock dividend was declared on the common stock, distributable on January 20, 2021. The market price per share for the common stock on December 1, 2020, was $23.

No other stock transactions took place during 2018, 2019, or 2020.

Required:

Prepare the entries to record the dividend transactions for 2018, 2019, and 2020. (Do not record any transactions for 2021.)

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