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xConnect https://newconnect.mheducation.com/flow/connect.html Saved Help Save & Exit Submit Check my work Shown below in T-account format are the changes affecting the retained earnings of Forge Corporation during 2018. At January 1, 2018, the corporation had outstanding 105 million common shares, $1 par per share Retirement of 5 million common 1ee Beginning balance shares for $29 million 84 Net income for the year Declaration and payment of 32 $0.32 per share cash dividend Declaration and distribution of a 28 6% stock dividend 121 Ending balance Required: 1. From the information provided by the account changes you should be able to recreate the transactions that affected Forge's retained earnings during 2018. Prepare the journal entries that Forge must have recorded during the year for these transactions 2. Prepare a statement of retained earnings for Forge for the year ended 2018. Complete this question by entering your answers in the tabs below. Required 1 Required 2 From the information provided by the account changes you should be able to recreate the transactions that affected Forge's retained earnings during 2018. Prepare the journal entries that Forge must have recorded during the year for these transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account feld. Enter your answers in millions (i.e., 10,008,000 should be entered as 10) Show less A View transaction list View journal entry worksheetExplanation / Answer
Required 1
Explanation :
1.
Common stock = 5 million shares x $1 = $5
Paid in capital-excess of par = 29 - 5 - 3 =$21
4.
Common stock = (105 - 5) x 6% = $6
Paid-in capital-excess of par = 28 - 6 = $22
Required 2:
Forge Corporation
Statement of Retained Earnings
for the year ended December 31, 2018
Balance at January 1
$100
Add: Net Income
$84
Deductions:
Retirement of Common stock
(3)
Cash dividends of $0.32
(32)
6% stock dividend
(28)
Balance at December 31
$121
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No Event General Journal Debit Credit 1 1 Common Stock $5 Paid-in Capital-excess of par $21 Retained Earnings $3 Cash $29 2 2 Income Summary $84 Retained earnings $84 3 3 Retained earnings $32 Cash $32 4 4 Retained earnings $28 Common stock $6 Paid-in Capital-excess of par $22Related Questions
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