Question

cise 13-18: Journal Entries, Statement of RE, Statement of SE: N: Alexander Corporation reports the following Shareholders' Equity section on 12/31/16, Common Stock-$25 par value, 50,000 shares authorized, 33,000 shares issued and outstanding Paid-in capital in excess of par value, common stock Retained earnings Total stockholders' equity $ S $ S 825,000 66,000 350,000 1.241.000 In 2017, the following transactions affected the stockholders' equity accounts: REQUIRED: Part 1) Prepare the Journal Entries. 1/2/2017 Purchased 3,300 shares of its own stock at $25 cash per share. 1/7/2017 Directors declared a $1.50 per share cash dividend payable on 2/28/17 to stockholders of record on 2/9/17. 2/28/2017 Paid the cash dividend declared on 1/7/17. 7/9/2017 Sold 1,320 of its treasury shares at $30 cash per share. 8/27/2017 Sold 1,650 of its treasury shares at $20 cash per share 9/9/2017 Directors declared a $2.00 per share cash dividend payable on 10/22/17 to stockholders of record on 9/23/17. 10/22/2017 Paid the dividend declared on 9/9/17. 12/31/2017 Closed the $55,000 credit balance (from net income) in the Income Summary acount to RE. Parts 2 & 3: Prepare the Statement of RE and Stockholders' Equity section of BS. Statement of Retained Earnings For the Year Ended December 31, 2017 Stockholders' Equity Section of the Balance Sheet at December 31, 2017

Answer 1

	Number of shares outstanding	Dividend paid
Beginning	33000
1/2	(3300)
Balance	29700
1/7		29700*1.5= 44550
7/9	1320
8/27	1650
Balance	32670
9/9		32670*2= 65340
Total		109890

	Common stock	Paid in capital in excess of par -common stock	Paid in capital in excess of cost - treasury stock	Retained earning	Treasury stock
Beginning	825000	66000		350000
1/2					3300*25=82500
1/7				(44550)
7/9			1320*5= 6600		1320*25=(33000)
8/27			(6600)	(1650)	1650*20= (33000)
9/9				(65340)
12/31				55000
Total	825000	66000	0	293460	16500

**On sale of treasury stock on 8/27 ,there is a loss of [20-25 = -5*1650] = -8250 .This loss will set off against paid in capital from treasury stock (first ,up to balance available ) and remaining from retained earning(8250 -6600 = 1650)

1)

STATEMENT OF RETAINED EARNING FOR THE YEAR ENDED DECEMBER 31 2017
Balance as on 1/1/2017	350000
Add:Net Income	55000
	405000
Dividend declared	(109890)
Loss on sale of treasury stock	(1650)
Balance as on 31/12/2017	293460

b)

Stockholders equity section of Balance sheet at December 31 2017
common stock -$ 25 Par value ,50000 shares authorized ,33000 shares and outstanding	825000
Paid in capital in excess of par -common stock	66000
Retained earning	293460
Treasury stock	(16500)
Total stockholders equity	1167960