Problem #3 -- Entries for selected corporate transactions
Bath ‘n More Inc. manufactures bathroom fixtures. The stockholders'
equity accounts of Bath ‘n More Inc., with balances on January 1, 2012, are as
Common Stock, $10 stated value (600,000 shares
authorized, 400,000 shares issued) $4,000,000
Paid-In Capital in Excess of Stated Value 750,000
Retained Earnings 9,150,000
Treasury Stock (40,000 shares, at cost) 600,000
The following selected transactions occurred during the year:
4. Paid cash dividends of $0.13 per
share on the common stock. The dividend had been properly recorded when
declared on December 1 of the preceding fiscal year for $46,800.
3. Issued 75,000 shares of common
stock for $1,200,000.
6. Sold all of the treasury stock for
1. Declared a 4% stock dividend on
common stock, to be capitalized at the market price of the stock, which is $18
15. Issued the certificates for the
dividend declared on July 1.
10. Purchased 25,000 shares of treasury
stock for $500,000.
27. Declared a $0.16-per-share dividend
on common stock.
Closed the credit balance of
the income summary account, $950,000.
Closed the two dividends
accounts to Retained Earnings.
Enter the January 1 balances in T accounts for
the stockholders' equity accounts listed. Also prepare T accounts for the
following: Paid-In Capital from Sale of Treasury Stock; Stock Dividends
Distributable; Stock Dividends; Cash Dividends.
Journalize the entries to record the
transactions, and post to the eight selected accounts.
Prepare a retained earnings statement for the
year ended December 31, 2012.
Prepare the Stockholders' Equity section of the
December 31, 2012, balance sheet.