edugen.wileyplus.com Return to Blackboard WileyPLUS andt, Accounting Principles,

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edugen.wileyplus.com Return to Blackboard WileyPLUS andt, Accounting Principles, 12e PRINTER VERSIONBACK NEXT ASSIGNMENT RESOURCES Problem 14-1A On January 1, 2017, Geffrey Corporation had the following stockholders equity accounts. Common Stock ($20 par value, 50,000 shares issued and outstanding) Paid-in Capital in Excess of Par-Common Stock Retained Earnings Chapter 14 14-3A $1,000,000 190,000 550,000 Review Score Review Results by Study During the year, the following transactions occurred of record on February 15, payable March 1. Feb. 1 Mar. 1 Apr. 1 July 1 31 Dec. 1 31 Declared a $1 cash dividend per share to Paid the dividend declared in February. Announced a 2-for-1 stock split. Prior to the split, the market price per share was 35. Declared a 10% stock dividend to stockholders of record on July 15, distributable July 31-On July 1, the market price of the stock was $14 per share. Issued the shares for the stock dividend Declared a $0.30 per share dividend to stockholders of record on December 15, payable January 5, 2018 Determined that net income for the year was $300,000 Journalize the transactions and the closing entries for net income and dividends, (Credit account titles are automatically indented when amount is entered. Do not indent manually, If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit

Explanation / Answer

The journal entries are prepared as below:

Date Account Titles and Explanation Debit Credit Feb-01 Cash Dividends (50,000*1) $50,000 Dividends Payable $50,000 Mar-01 Dividends Payable $50,000 Cash $50,000 Apr-01 No Entry $0 No Entry $0 Jul-01 Stock Dividends (50,000*2*10%*14) $140,000 Common Stock Dividends Distributable (50,000*2*10%*10) $100,000 Paid-in Capital in Excess of Par-Common Stock (50,000*2*10%*4) $40,000 Jul-31 Common Stock Dividends Distributable (50,000*2*10%*10) $100,000 Common Stock $100,000 Dec-01 Cash Dividends [(50,000*2 + 50,000*2*10%)*.30] $33,000 Dividends Payable $33,000 Dec-31 Income Summary $300,000 Retained Earnings $300,000 (To close net income) Dec-31 Retained Earnings $140,000 Stock Dividends $140,000 (To close stock dividends) Dec-31 Retained Earnings (50,000 + 33,000) $83,000 Cash Dividends $83,000 (To close cash dividends)

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