Chapter 13 Homework B (Question #10) Excercise 13-18

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Kroll Corporation reports the following components of stockholders’ equity on December 31, 2011.

In year 2012, the following transactions affected its stockholders’ equity accounts.

Jan. 2

Purchased 3,400 shares of its own stock at $29 cash per share.
Jan. 7

Directors declared a $2 per share cash dividend payable on Feb. 28 to the Feb. 9 stockholders of record.
Feb. 28 Paid the dividend declared on January 7.
July 9 Sold 500 of its treasury shares at $34 cash per share.
Aug. 27 Sold 2,900 of its treasury shares at $27 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 $12,000 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 2012. (Omit the “$” sign in your response.)

2. Prepare a statement of retained earnings for the year ended December 31, 2012. (Amounts to be deducted should be indicated with a minus sign. Omit the “$” sign in your response.)

3. Prepare the stockholders’ equity section of the company’s balance sheet as of December 31, 2012. (Omit the “$” sign in your response.)

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