The following information applies to the questions displayed below. The annual r

Question

The following information applies to the questions displayed below. The annual report for Malibu Beachwear reported the following transactions affecting stockholders' equity: a. Purchased $351,000 of common stock now held in treasury. b. Declared cash dividends in the amount of $260,500. c. Paid the dividends in (b) d. Issued 110,000 new shares of $0.10 par value common shares for $2 per share. e. Closed the Dividends account. value: 10.00 points 2. Prepare journal entries to record each of these events. (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 4 Record the purchase of $351,000 common stock. Note: Enter debits before credits. Event General Journal Debit Credit

Explanation / Answer

Date Account Head & Description Debit Amount Credit Amount a. Treasury stock 351000 Cash 351000 (to record purchase of own stock) b. Dividends 260500 Dividends payable 260500 (to record the dividends declared) c. Dividends payable 260500 Cash 260500 (to record the payment of dividends) d. Cash (110000*$2) 220000 Common stock (110000*$0.1) 11000 Additional paid-in capital (110000*$1.9) 209000 (to record the issue of common stock) e. Retained earnings 260500 Dividends 260500 (to record the closure of dividends account)

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