The annual report for Sneer Corporation disclosed that the company declared and paid preferred dividends in the amount of $260,000 in the current year. It also declared and paid dividends on common stock in the amount of $1.40 per share. During the current year, Sneer had 1 million common shares authorized; 460,000 shares had been issued; and 244,000 shares were in treasury stock. The opening balance in Retained Earnings was $740,000 and Net Income for the current year was $240,000. Required: 1. Prepare journal entries to record the declaration, and payment, of dividends on (a) preferred and (b) common stock. 2. Using the information given above, prepare a statement of retained earnings for the year ended December 31. 3. Prepare a journal entry to close the dividends account.

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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E11-11 (Algo) Recording Dividends and Preparing a Statement of Retained Earnings [LO 11-2, LO 11-3]
The annual report for Sneer Corporation disclosed that the company declared and paid preferred dividends in the amount of
$260,000 in the current year. It also declared and paid dividends on common stock in the amount of $1.40 per share. During the
current year, Sneer had 1 million common shares authorized; 460,000 shares had been issued; and 244,000 shares were in treasury
stock. The opening balance in Retained Earnings was $740,000 and Net Income for the current year was $240,000.
Required:
1. Prepare journal entries to record the declaration, and payment, of dividends on (a) preferred and (b) common stock.
2. Using the information given above, prepare a statement of retained earnings for the year ended December 31.
3. Prepare a journal entry to close the dividends account.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Prepare journal entries to record the declaration, and payment, of dividends on (a) preferred and (b) common stock. (If no entry is
required for a transaction/event, select "No Journal Entry Required" in the first account field.)
View transaction list
Journal entry worksheet
1
Required 3
2
3
4
Record the declaration of a cash dividend of $260,000 to the preferred
stockholders.
Note: Enter debits before credits.
Transcribed Image Text:E11-11 (Algo) Recording Dividends and Preparing a Statement of Retained Earnings [LO 11-2, LO 11-3] The annual report for Sneer Corporation disclosed that the company declared and paid preferred dividends in the amount of $260,000 in the current year. It also declared and paid dividends on common stock in the amount of $1.40 per share. During the current year, Sneer had 1 million common shares authorized; 460,000 shares had been issued; and 244,000 shares were in treasury stock. The opening balance in Retained Earnings was $740,000 and Net Income for the current year was $240,000. Required: 1. Prepare journal entries to record the declaration, and payment, of dividends on (a) preferred and (b) common stock. 2. Using the information given above, prepare a statement of retained earnings for the year ended December 31. 3. Prepare a journal entry to close the dividends account. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare journal entries to record the declaration, and payment, of dividends on (a) preferred and (b) common stock. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet 1 Required 3 2 3 4 Record the declaration of a cash dividend of $260,000 to the preferred stockholders. Note: Enter debits before credits.
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