Assignment:
RETAINED EARNINGS ACCOUNTS AND STATEMENT
On January 1, 20--, Glover Company's retained earnings accounts had the following balances:
Appropriated for land acquisition..............$ 60,000
Unappropriated retained earnings...............900,000
......................................................$960,000
During the year ended December 31, 20--, Glover completed the following selected transactions:
Mar. 20 Declared a semiannual dividend of $0.80 per share on preferred stock and $0.25 per share on common stock to shareholders of record on April 10, payable on April 15.
Currently, 10,000 shares of $50 par preferred stock and 100,000 shares of $5 par common stock are outstanding.
Apr. 15 Paid the cash dividends.
June 16 Last year, Glover's board of directors appropriated $180,000 over a three-year period for the purchase of land for a future building site. Made this year's appropriation for $60,000.
Oct. 10 Declared semiannual dividend of $0.80 per share on preferred stock and $0.25 per share on common stock to shareholders of record on November 5, payable on November 10.
Nov. 10 Paid the cash dividends.
17 Declared a 5% stock dividend to shareholders of record on December 8, distributable on December 15. Market value of the common stock was estimated at $18 per share.
Dec. 15 Issued certificates for common stock dividend.
31 Net income for 20-- was $290,000. Closed the income summary account.
31 Closed the cash dividends and stock dividends accounts.
REQUIRED
1. Prepare journal entries for the transactions.
2. Post all entries affecting the appropriated and unappropriated retained earnings accounts to T accounts.
3. Prepare a retained earnings statement for the year ended December 31, 20--.