Kohler Corporation reports the following components of stockholders’ equity on December 31, 2015: Common stock—$15 par value, 100,000 shares authorized, 50,000 shares issued and outstanding $ 750,000 Paid-in capital in excess of par value, common stock 70,000 Retained earnings 370,000 Total stockholders’ equity $ 1,190,000 In year 2016, the following transactions affected its stockholders’ equity accounts.
Jan. 1 Purchased 6,000 shares of its own stock at $20 cash per share.
Jan. 5 Directors declared a $4 per share cash dividend payable on Feb. 28 to the Feb. 5 stockholders of record.
Feb. 28 Paid the dividend declared on January 5. July 6 Sold 2,250 of its treasury shares at $24 cash per share.
Aug. 22 Sold 3,750 of its treasury shares at $17 cash per share.
Sept. 5 Directors declared a $4 per share cash dividend payable on October 28 to the September 25 stockholders of record.
Oct. 28 Paid the dividend declared on September 5.
Dec. 31 Closed the $408,000 credit balance (from net income) in the Income Summary account to Retained Earnings.
1) Prepare journal entries to record each of these transactions for 2016.
2) Prepare a statement of retained earnings for the year ended December 31, 2016. (Amounts to be deducted should be indicated by a minus sign.)
3)Prepare the stockholders' equity section of the company’s balance sheet as of December 31, 2016. KOHLER CORPORATION Stockholders' Equity Section of the Balance Sheet December 31, 2016 Total contributed capital 0 Total stockholders' equity $0.