The stockholders’ equity accounts of Rayburn Corporation as of January 1 appear below: Common stock, $7 par value, 400,000 shares authorized; 180,000 shares issued and outstanding $1,260,000 Paid-in capital in excess of par value 920,000 Retained earnings 513,000 During the year, the following transactions occurred: June 7 Declared a 10 percent stock dividend; market value of the common stock was $13 per share. June 28 Issued the stock dividend declared on June 7. Dec. 5 Declared a cash dividend of $1.45 per share. Dec. 26 Paid the cash dividend declared on December 5.
The
| Common stock, $7 par value, 400,000 shares authorized; | |
| 180,000 shares issued and outstanding | $1,260,000 |
| Paid-in capital in excess of par value | 920,000 |
| 513,000 |
During the year, the following transactions occurred:
| June | 7 | Declared a 10 percent stock dividend; market value of the common stock was $13 per share. |
| June | 28 | Issued the stock dividend declared on June 7. |
| Dec. | 5 | Declared a cash dividend of $1.45 per share. |
| Dec. | 26 | Paid the cash dividend declared on December 5. |
Required
a. Prepare
| General Journal | |||
|---|---|---|---|
| Date | Description | Debit | Credit |
| Jun.07 | Answer | Answer | Answer |
| Stock Dividends Distributable | Answer | Answer | |
| Answer | Answer | Answer | |
| Declared stock dividend. | |||
| Jun.28 | Answer | Answer | Answer |
| Common Stock | Answer | Answer | |
| Issued common shares as stock dividend. | |||
| Dec.05 | Answer | Answer | Answer |
| Answer | Answer | Answer | |
| Declared a cash dividend on common stock outstanding. | |||
| Dec.26 | Answer | Answer | Answer |
| Answer | Answer | Answer | |
| Paid cash dividend declared on Dec. 5. |
b. Prepare a statement of retained earnings. The net income for the year is $432,000.
Do not use negative signs with your answers.
| RAYBURN CORPORATION Statement of Retained Earnings For the Year Ended December 31 |
|||
|---|---|---|---|
| Retained Earnings, January 1 | Answer | ||
| Answer | Answer | ||
| Answer | |||
| Answer | Answer | ||
| Stock Dividends Declared | Answer | Answer | |
| Answer | Answer |
You enter transaction information into your company's books to create a journal entry. In the second step of the accounting cycle, your journal entries are decided to enter into the general ledger. Financial reporting journals are used to keep track of business transactions before posting them to the general ledger. Every journal entry in the general ledger included the transaction date, amount, affected accounts with account information, and a description. The journal entry may also include an identifier, such as a cheque number, and a brief explanation of the transaction.
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