I. At the beginning of 20x1, Metro showed the following amounts in the stockhold
ID: 2532157 • Letter: I
Question
I. At the beginning of 20x1, Metro showed the following amounts in the stockholders' equity section of its balance sheet Stockholders' Equity Common stock, $1 par, 500,000 shares authorized, 382,000 shares issued and outstanding PCIEP Retained earnings 4,202,000 2,704,600 S7,288,600 Total stockholders' equity The transactions relating to stockholders' equity accounts during the year are as follows; Declared a dividend of $1 per share to stockholders of record on 1/31, payable on 2/15 1/3 2/15 Paid the cash dividend declared on 1/3 Metro purchased 6,000 shares of its own common stock at a price of S40 per share 4/12 5/9 Reissued 4,000 shares of the treasury stock at a price of $44 per share Declared a 5% stock dividend to stockholders of record at 6/ 15, to be distributed on 6/30. The market price of the stock was S42 per share on 6/1 and $45 per share on 6/15. 6/1 6/30 Distributed the stock dividend declared on 6/1 Required 1) Prepare in general journal form the entries to record the above transactions. 2) Prepare the stockholders' equity section of the balance sheet at 12/31/xl.Explanation / Answer
Date Accounts Title Dr Cr 3-Jan Cash Dividend $382,000 Cash Dividend Payable (382000*1) $382,000 15-Feb Cash Dividend Payable (382000*1) $382,000 Cash $382,000 12-Apr Treasury Stock $240,000 Cash (6000*40) $240,000 9-May Cash (4000*44) $176,000 Paid in capital in excess-Treasury stock $16,000 Treasury Stock 160000 1-Jun Stock Dividend (19000*42) 798000 Stock Dividend distributale 19000 Paid in capital in excess of par-Common stock 779000 (19000*41) No. of common stock issued (382000-6000+4000)*5% 19000 Stockholder Equity section Common stock $1 par, 500000 authorized 401000 401000 shares issued and 399000 shares outstanding Paid in capital in excess of par-Common stock 4981000 Total Paid in capital 5382000 Retained Earnings (2704600-382000-798000) 1524600 Treasury stock (at cost) -80000 Total stockholder Equity 1444600