60.1K

Verified Solution

Link Copied!

On January 1, 2022, Blossom Corporation had the following stockholders equity accounts.

Common Stock ($26 par value, 65,000 shares issued and outstanding)		$1,690,000
Paid-in Capital in Excess of ParCommon Stock		191,000
Retained Earnings		649,000

During the year, the following transactions occurred.

Feb. 1		Declared a $1 cash dividend per share to stockholders of record on February 15, payable March 1.
Mar. 1		Paid the dividend declared in February.
Apr. 1		Announced a 2-for-1 stock split. Prior to the split, the market price per share was $40.
July 1		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.
31		Issued the shares for the stock dividend.
Dec. 1		Declared a $0.30 per share dividend to stockholders of record on December 15, payable January 5, 2023.
31		Determined that net income for the year was $388,000.

Thank you!

Account Titles and Explanation Debit Credit Cash Dividends 65000 Dividends Payable 65000 Dividends Payable Cash 65000 No Entry No Entry Stock Dividends Common Stock Dividends Distributable 1,690,000 Pald-in Capital in Excess of Par-Common Stock Common Stock Dividends Distributable Common Stock 10 1.10000001, 100 65000 Cash Dividends Dividends Payable Income Summary 388000 Retained Earnings 388000 (To close net income) Retained Earnings Stock Dividends 19500 (To close stock dividends) Retained Earnings 388000 Cash Dividends 388000 (To close cash dividends)

Answer & Explanation Solved by verified expert

See Answer