Question

In: Accounting

Daryl Corporation produces and sells hats. The Stockholders' Equity accounts on January 1, 2020 are as...

Daryl Corporation produces and sells hats. The Stockholders' Equity accounts on January 1, 2020 are as follows:

Common Stock, $5 par (100,000 shares authorized, 40,000 shares issued) $200,000

PIC in Excess par - Common Stock $100,000

Retained Earnings $750,000

Treasury Stock (5,000 shares at cost) $50,000

The following transactions occurred during the year:

1/09 Declared a Cash Dividend of $0.80 per share on the Common Stock outstanding.

Dividend will be paid on 2/09.

2/09 Paid the Cash Dividend that was previously declared on 1/16.

3/23 Reissued 2,500 shares of the Treasury Stock at $25 per share.

4/20 Issued 15,000 shares of Common Stock for $30 per share.

8/03 The directors declare a 2% stock dividend to be distributed on 9/13. The market

value is $40 per share on this date.

9/13 Distributed the Stock Dividend declared on 8/03.

11/17 Reissued the remaining 2,500 shares of Treasury Stock for $8 per share.

12/30 Declared a Cash Dividend of $0.90 per share on the Common Stock outstanding. The

dividend will be paid on 1/30.

12/31 Closed the $80,000 credit balance of the Income Summary account.

12/31 Closed the dividends accounts.

REQUIRED:

(1) Prepare the Journal Entries for the above transactions.

(2) Prepare the Statement of Stockholders' Equity (In Good Form) as of 12/31/20.

Expert Solution

1.

Date	Particulars	Debit	Credit
Jan-09	Retained earnings	$ 28,000
	Dividend payable		$ 28,000
	[Dividend declared]

Feb-09	Dividend payable	Amount N/A
	Cash		Amount N/A
	[Previously declared dividend paid]

Mar-23	Cash	$ 62,500
	Treasury stock		$ 25,000
	APIC - T/S		$ 37,500
	[Treasury stock reissued]

Apr-20	Cash	$ 450,000
	common stock		$ 75,000
	APIC - C/S		$ 375,000
	[Common stock issued]

Aug-03	Retained earnings	$ 44,000
	Common stock (distributable)		$ 5,500
	APIC - C/S		$ 38,500
	[Stock dividend declared, provision made]

Sep-13	Common stock (distributable)	$ 5,500
	Common stock		$ 5,500
	[Stock dividend declared issued]

Nov-17	Cash	$ 20,000
	APIC - T/S	$ 5,000
	Treasury stock		$ 25,000
	[Treasury stock reissued]

Dec-30	Retained earnings	$ 49,500
	Dividend payable		$ 49,500
	[Cash dividend declared]

Dec-31	No entry

2.

Statement of stockholder's equity

Particulars	common stock	APIC C/S	Retained earnings	Treasury stock	APIC T/S
Openind O/S	$ 200,000	$ 100,000	$ 750,000	$ 50,000
Cash Dividend			$ (28,000)
Treasury stock Reissued				$ (25,000)	$ 37,500
15000 stocks Issued	$ 75,000	$ 375,000
Stock dividend	$ 5,500	$ 38,500	$ (44,000)
Treasury stock Reissued				$ (25,000)	$ (5,000)
Cash Dividend			$ (49,500)
Total	$ 280,500	$ 513,500	$ 628,500	$ -	$ 32,500

For any clarification, please comment. Kindly Up Vote!

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