Question

mostafa Corporation had retained earnings at January 1, 2017, of $950,000.

the Corporation had 500,000 shares of $ 2.5 par value common stock outstanding throughout 2017. Net income for 2017 was $520,000. The following transactions occurred during 2017:

​

​July 1​​A cash dividends of $0.5 per share was declared to stockholders of

record on July 20.

​Aug. 1​​Paid the cash dividends.

​Nov. 1​​A 7% stock dividends was declared. The market price at the declaration date was  

  $9 per share.

​Dec. 15​Distributed the stock dividends shares.

Required:

1. Journalize the 2017 dividends transactions.

2. Prepare a retained earnings statement for 2017.

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Question 2 :

The following accounts appear in the ledger of Aston Corporation after the books are closed at December 31, 2008.

Common Stock, $1 par value, 500,000 shares authorized, 400,000 shares

issued …………………………………………………………………………$400,000

Paid-in Capital in Excess of Par Value—Common Stock ………………….....650,000

Preferred Stock, $100 par value, 8%, 10,000 shares authorized; 2,000 shares

issued …………………………………………………………………………..200,000

Retained Earnings ……………………………………………………………..950,000

Treasury Stock (10,000 common shares) ………………………………………85,000

Paid-in Capital in Excess of Par Value—Preferred Stock …………………….310,000

Required: Prepare the stockholders' equity section at December 31, 2008.

Answer 1

1. Journal Entries -

2. Retained Earnings Statement -

3. The stockholders' equity section -