The equity sections for Fairhaven Group at the beginning of the year (January 1) and end of the year (December 31) follow. Stockholders' Equity (January 1) Common stock-$10 par value, 130,000 shares authorized, 50,000 shares issued and outstanding Paid-in capital in excess of par value, common stock Retained earnings Total stockholders' equity Stockholders' Equity (December 31) Common stock-$10 par value, 130,000 shares authorized, 58,010 shares issued, 5,500 shares in treasury Paid-in capital in excess of par value, common stock Retained earnings ($110,000 restricted by treasury stock) Less cost of treasury stock Total stockholders' equity The following transactions and events affected its equity during the year. January 5 Declared a $1.20 per share cash dividend, payable on January 10. March 20 Purchased treasury stock for cash. April 5 Declared a $1.20 per share cash dividend, payable on April 10. July 5 Declared a $1.20 per share cash dividend, payable on July 10. July 31 Declared a 18 % stock dividend when the stock's market value was $22 per share. August 14 Issued the stock dividend that was declared on July 31. October 5 Declared a $1.20 per share cash dividend, date of record October 10. $ 500,000 75,000 410,000 $ 985,000 $ 580,100 171,120 740,000 1,491,220 (110,000) $ 1,381,220
The equity sections for Fairhaven Group at the beginning of the year (January 1) and end of the year (December 31) follow. Stockholders' Equity (January 1) Common stock-$10 par value, 130,000 shares authorized, 50,000 shares issued and outstanding Paid-in capital in excess of par value, common stock Retained earnings Total stockholders' equity Stockholders' Equity (December 31) Common stock-$10 par value, 130,000 shares authorized, 58,010 shares issued, 5,500 shares in treasury Paid-in capital in excess of par value, common stock Retained earnings ($110,000 restricted by treasury stock) Less cost of treasury stock Total stockholders' equity The following transactions and events affected its equity during the year. January 5 Declared a $1.20 per share cash dividend, payable on January 10. March 20 Purchased treasury stock for cash. April 5 Declared a $1.20 per share cash dividend, payable on April 10. July 5 Declared a $1.20 per share cash dividend, payable on July 10. July 31 Declared a 18 % stock dividend when the stock's market value was $22 per share. August 14 Issued the stock dividend that was declared on July 31. October 5 Declared a $1.20 per share cash dividend, date of record October 10. $ 500,000 75,000 410,000 $ 985,000 $ 580,100 171,120 740,000 1,491,220 (110,000) $ 1,381,220
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:The equity sections for Fairhaven Group at the beginning of the year (January 1) and end of the year (December 31) follow.
Stockholders' Equity (January 1)
Common stock-$10 par value, 130,000 shares authorized, 50,000 shares issued and outstanding
Paid-in capital in excess of par value, common stock
Retained earnings
Total stockholders' equity
Stockholders' Equity (December 31)
Common stock-$10 par value, 130,000 shares authorized, 58,010 shares issued, 5,500 shares in treasury
Paid-in capital in excess of par value, common stock
Retained earnings ($110,000 restricted by treasury stock)
Less cost of treasury stock
Total stockholders' equity
The following transactions and events affected its equity during the year.
January 5 Declared a $1.20 per share cash dividend,
March 20 Purchased treasury stock for cash.
payable on January 10.
April 5 Declared a $1.20 per share cash dividend,
payable on April 10.
July 5 Declared a $1.20 per share cash dividend, payable on July 10.
July 31 Declared a 18 % stock dividend when the stock's market value was $22 per share.
August 14 Issued the stock dividend that was declared on July 31.
October 5 Declared a $1.20 per share cash dividend, date of record October 10.
Requirement
General
Journal
View transaction list
<
Journal entry worksheet
General
Ledger
Note: Enter debits before credits.
Date
December 31
The following transactions and events affected its equity during the year. Prepare the journal entry necessary to record each
event, and then agree the year-end balances with the December 31 Stockholders' Equity statement given above.
Close income summary to retained earnings.
Record entry
Trial Balance
Income summary
Retained earnings
8
Account Title
Clear entry
Cash
Dividends
Stock Dividend
10
11
Debit
12
Credit
$ 500,000
75,000
410,000
$ 985,000
View general journal
$ 580,100
171, 120
740,000
1,491,220
(110,000)
$ 1,381,220
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