Question

On January 1, 2020, Crane Corporation had the following stockholders' equity accounts. Common Stock ($26 par value, 50,000 shares issued and outstanding) Paid-in Capital in Excess of Par-Common Stock Retained Earnings $1,300,000 194,000 619,000 During the year, the following transactions occurred. Feb. 1 Declared a $2 cash dividend per share to stockholders of record on February 15, payable March 1. Mar. 1 Paid the dividend declared in February Apr. 1 Announced a 2-for-1 stock split. Prior to the split, the market price per share was $36. July 1 Declared a 10% stock dividend to stockholders of record on July 15, distributable July 31. On July 1, the market price of the stock was $15 per share. 31 Issued the shares for the stock dividend. Dec. 1 Declared a $0.40 per share dividend to stockholders of record on December 15, payable January 5, 2021. 31 Determined that net income for the year was $393,500.

Answer 1

Common Stock
Date	Explanation	Debit	Credit	Balance
Jan 1	Balance			1,300,000 Cr.
July 31	Stock Dividend		130,000
Dec 31	Balance			1,430,000 Cr.
Common Stock Dividends Distributable
Date	Explanation	Debit	Credit	Balance
July 1	Declaration of Stock Dividend		130,000
July 31	Issuance of Stock Dividend	130,000
Dec 31	Balance			0
Paid-in Capital in Excess of Par: Common Stock
Date	Explanation	Debit	Credit	Balance
Jan 1	Balance			194,000 Cr.
July 1	Declaration of Stock Dividend		20,000
Dec 31	Balance			214,000 Cr.
Retained Earnings
Date	Explanation	Debit	Credit	Balance
January 1	Balance			619,000 Cr.
July 1	Declaration of Stock Dividend	150,000
Dec 31	Net Income		393,500
Dec 31	Cash Dividends	144,000
Dec 31	Balance			718,500 Cr.
Cash Dividends
Date	Explanation	Debit	Credit	Balance
Feb 1	Declaration	100,000
Dec 1	Declaration	44,000
Dec 31	Closed to Retained Earnings		144,000
Dec 31	Balance			0