Question
In: Accounting
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2016: Common stock—$25 par...
Alexander Corporation
reports the following components of stockholders’ equity on
December 31, 2016:
|
Common stock—$25 par value, 60,000 shares authorized, 40,000 shares issued and outstanding |
$ | 1,000,000 | |
| Paid-in capital in excess of par value, common stock | 80,000 | ||
| Retained earnings | 375,000 | ||
| Total stockholders’ equity | $ | 1,455,000 | |
In year 2017, the following transactions affected its stockholders’
equity accounts.
| Jan. | 2 | Purchased 4,000 shares of its own stock at $25 cash per share. | ||
| Jan. | 7 | Directors declared a $1.50 per share cash dividend payable on February 28 to the February 9 stockholders of record. | ||
| Feb. | 28 | Paid the dividend declared on January 7. | ||
| July | 9 | Sold 1,600 of its treasury shares at $30 cash per share. | ||
| Aug. | 27 | Sold 2,000 of its treasury shares at $20 cash per share. | ||
| Sept. | 9 | Directors declared a $2 per share cash dividend payable on October 22 to the September 23 stockholders of record. | ||
| Oct. | 22 | Paid the dividend declared on September 9. | ||
| Dec. | 31 | Closed the $62,000 credit balance (from net income) in the Income Summary account to Retained Earnings. |
Required:
1. Prepare journal entries to record each of these
transactions for 2017.
2. Prepare a statement of retained earnings for
the year ended December 31, 2017.
3. Prepare the stockholders’ equity section of the
company’s balance sheet as of December 31, 2017.
Complete this question by entering your answers in the tabs below.
Record the purchase 4,000 shares of its own common stock for $25 cash per share.
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| Jan 02 | |||
| 0 |
Record the declaration of a cash dividend of $1.50 per share.
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| Jan 07 | |||
Record the payment of the cash dividend declared on January 7.
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| Feb 28 | |||
Record the reissue of 1,600 shares of the treasury stock for $30 cash per share.
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| Jul 09 | |||
Record the reissue of 2,000 shares of the treasury stock for $20 cash per share.
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| Aug 27 | |||
Record the declaration of a cash dividend of $2 per share.
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| Sep 09 | |||
Record the payment of the cash dividend declared on September 9.
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| Oct 22 | |||
Record the transfer of the credit balance of $62,000 in the income summary account to the retained earnings account.
| Date | General Journal | Debit | Credit |
|---|---|---|---|
| Dec 31 | |||
Prepare a statement of retained earnings for the year ended December 31, 2017. (Amounts to be deducted should be indicated by a minus sign.)
|
|||||||||||||||||||
Prepare the stockholders’ equity section of the company’s balance sheet as of December 31, 2017. (Amounts to be deducted should be indicated by a minus sign.)
|
|||||||||||||||||
Solutions
Expert Solution
| Date | General Journal | Debit | Credit | |
| Jan 02 | Treasury stock, common | 100,000 | (4000 x $25) | |
| Cash | 100,000 | |||
| Jan 07 | Retained earnings | 54,000 | (36000 x 1.5) | |
| Common dividend payable | 54,000 | |||
| Feb 28 | Common dividend payable | 54,000 | ||
| Cash | 54,000 | |||
| Jul 09 | Cash | 48,000 | (1600 x 30) | |
| Treasury stock, common | 40,000 | (1600 x 25) | ||
| Paid-in capital, treasury stock | 8,000 | Diff. | ||
| Aug 27 | Cash | 40,000 | (2000 x 20) | |
| Paid-in capital, treasury stock | 8,000 | |||
| Retained earnings | 2,000 | |||
| Treasury stock, common | 50,000 | (2000 x 25) | ||
| Sep 09 | Retained earnings | 79,200 | (40000-400)x 2 | |
| Common dividend payable | 79,200 | |||
| Oct 22 | Common dividend payable | 79,200 | ||
| Cash | 79,200 | |||
| Dec 31 | Income summary | 62,000 | ||
| Retained earnings | 62,000 | |||
| ALEXANDER CORPORATION | ||||
| Statement of Retained Earnings | ||||
| For Year Ended December 31, 2017 | ||||
| Retained earnings, December 31, 2016 | $375,000 | |||
| Add: Net income | 62,000 | |||
| 437000 | ||||
| Less: Cash dividends declared | -133,200 | |||
| Less: Treasury stock reissuances | -2,000 | |||
| Retained earnings, December 31, 2017 | 301800 | |||
| ALEXANDER CORPORATION | ||||
| Stockholders’ Equity Section of the Balance Sheet | ||||
| December 31, 2017 | ||||
| Common stock - $25 par value | $1,000,000 | |||
| Paid-in capital in excess of par value, common stock | 80,000 | |||
| Retained earnings | 301,800 | |||
| Less cost of treasury stock(400 shares x $25) | -10,000 | |||
| Total stockholders’ equity | $ 1,371,800 | |||
ekkarill92 answered 1 year agoRelated Solutions
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2016: Common stock—$25 par...
Alexander Corporation reports the following components of
stockholders’ equity on December 31, 2016:
Common stock—$25 par value, 70,000 shares authorized,
46,000 shares issued and outstanding
$
1,150,000
Paid-in capital in excess of par value, common stock
92,000
Retained earnings
396,000
Total stockholders’ equity
$
1,638,000
In year 2017, the following transactions affected its stockholders’
equity accounts.
Jan.
2
Purchased 4,600 shares of its own stock at $25 cash per
share.
Jan.
7
Directors declared a $1.50 per share cash dividend...
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2016: Common stock—$25 par...
Alexander Corporation reports the following components of
stockholders’ equity on December 31, 2016:
Common stock—$25 par value, 60,000 shares authorized,
36,000 shares issued and outstanding $ 900,000
Paid-in capital in excess of par value, common stock 72,000
Retained earnings 361,000
Total stockholders’ equity $ 1,333,000
In year 2017, the following transactions affected its stockholders’
equity accounts.
Jan. 2 Purchased 3,600 shares of its own stock at $25 cash per
share.
Jan. 7 Directors declared a $1.50 per share cash dividend...
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2016: Common stock—$25 par...
Alexander Corporation reports the following components of
stockholders’ equity on December 31, 2016:
Common stock—$25 par value, 60,000 shares authorized,
36,000 shares issued and outstanding $ 900,000
Paid-in capital in excess of par value, common stock 72,000
Retained earnings 361,000
Total stockholders’ equity $ 1,333,000
In year 2017, the following transactions affected its stockholders’
equity accounts.
Jan. 2 Purchased 3,600 shares of its own stock at $25 cash per
share.
Jan. 7 Directors declared a $1.50 per share cash dividend...
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2016: Common stock—$25 par...
Alexander Corporation reports the following components of
stockholders’ equity on December 31, 2016:
Common stock—$25 par
value, 50,000 shares authorized,
31,000 shares issued and outstanding
$
775,000
Paid-in capital in excess of par
value, common stock
62,000
Retained earnings
343,000
Total stockholders’ equity
$
1,180,000
In year 2017, the following transactions affected its stockholders’
equity accounts.
Jan.
2
Purchased 3,100 shares of its own
stock at $25 cash per share.
Jan.
7
Directors declared a $1.50 per
share cash dividend...
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2016: Common stock—$25 par...
Alexander Corporation reports the following components of
stockholders’ equity on December 31, 2016:
Common stock—$25 par value, 50,000 shares authorized,
34,000 shares issued and outstanding
$
850,000
Paid-in capital in excess of par value, common stock
68,000
Retained earnings
354,000
Total stockholders’ equity
$
1,272,000
In year 2017, the following transactions affected its stockholders’
equity accounts.
Jan.
2
Purchased 3,400 shares of its own stock at $25 cash per
share.
Jan.
7
Directors declared a $1.50 per share cash dividend...
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2016: Common stock—$25 par...
Alexander Corporation
reports the following components of stockholders’ equity on
December 31, 2016:
Common stock—$25 par value, 60,000 shares authorized,
35,000 shares issued and outstanding
$
875,000
Paid-in capital
in excess of par value, common stock
70,000
Retained
earnings
357,000
Total
stockholders’ equity
$
1,302,000
In year 2017, the following transactions affected its stockholders’
equity accounts.
Jan.
2
Purchased 3,500
shares of its own stock at $25 cash per share.
Jan.
7
Directors declared
a $1.50 per share cash dividend...
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2016: Common stock—$25 par...
Alexander Corporation reports the following components of
stockholders’ equity on December 31, 2016: Common stock—$25 par
value, 70,000 shares authorized, 42,000 shares issued and
outstanding $ 1,050,000 Paid-in capital in excess of par value,
common stock 84,000 Retained earnings 382,000 Total stockholders’
equity $ 1,516,000 In year 2017, the following transactions
affected its stockholders’ equity accounts. Jan. 2 Purchased 4,200
shares of its own stock at $25 cash per share. Jan. 7 Directors
declared a $1.50 per share cash dividend...
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2016: Common stock—$25 par...
Alexander Corporation reports the following components of
stockholders’ equity on December 31, 2016:
Common stock—$25 par value, 60,000 shares authorized,
37,000 shares issued and outstanding
$
925,000
Paid-in capital in excess of par value, common stock
74,000
Retained earnings
364,000
Total stockholders’ equity
$
1,363,000
In year 2017, the following transactions affected its stockholders’
equity accounts.
Jan.
2
Purchased 3,700 shares of its own stock at $25 cash per
share.
Jan.
7
Directors declared a $1.50 per share cash dividend...
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2016: Common stock—$25 par...
Alexander Corporation reports the following components of
stockholders’ equity on December 31, 2016: Common stock—$25 par
value, 50,000 shares authorized, 33,000 shares issued and
outstanding $ 825,000 Paid-in capital in excess of par value,
common stock 66,000 Retained earnings 350,000 Total stockholders’
equity $ 1,241,000 In year 2017, the following transactions
affected its stockholders’ equity accounts. Jan. 2 Purchased 3,300
shares of its own stock at $25 cash per share. Jan. 7 Directors
declared a $1.50 per share cash dividend...
Alexander Corporation reports the following components of stockholders’ equity on December 31, 2017. Common stock—$25 par...
Alexander Corporation reports the following components of
stockholders’ equity on December 31, 2017.
Common stock—$25 par value, 50,000 shares authorized,
34,000 shares issued and outstanding
$
850,000
Paid-in capital in excess of par value, common stock
68,000
Retained earnings
354,000
Total stockholders’ equity
$
1,272,000
In year 2018, the following transactions affected its stockholders’
equity accounts.
Jan.
2
Purchased 3,400 shares of its own stock at $25 cash per
share.
Jan.
7
Directors declared a $1.50 per share cash dividend...
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