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    Journal entries, and statement of retained earnings

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    Kohler Corporation reports the following components of stockholders' equity on December 31, 2008.

    Common stock-$20 par value, 200,000 shares authorized,
    50,000 shares issued and outstanding $ 500,000
    Paid-in capital in excess of par value, common stock 70,000
    Retained earnings 260,000

    $ 830,000

    In year 2009, the following transactions affected its stockholders' equity accounts:

    Jan. 1 Purchased 3,000 shares of its own stock at $30 cash per share.
    Jan. 5 Directors declared a $3 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 1,600 of its treasury shares at $26 cash per share.
    Aug. 22 Sold 1,400 of its treasury shares at $19 cash per share.
    Sep. 5 Directors declared a$3 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 $366,000 credit balance (from net income) in the Income Summary account to Retained Earnings.

    Requirement 1:

    Prepare journal entries to record these transactions for 2009.
    Date General Journal Debit Credit
    Jan 1 _____ _____
    _______ _____

    Jan 5 _______ _____
    ______ _____

    Feb 28 _______ ______
    _______ ______

    July 6 _______ ______
    _______ _____
    _______ ______

    Aug 22 ______ _______
    ______ ________
    ______ _______
    _______ ______

    Sept 5 _______ _______
    ______ _______

    Oct 28 ________ _______
    _______ ________

    Dec 31 _______ ________
    _______ ________

    Requirement 2:

    Prepare a statement of retained earnings for the year ended December 31, 2009.
    KOHLER CORPORATION
    Statement of Retained Earnings
    For Year Ended December 31, 2009

    _______ $ ______
    _______: _________ ______
    ______
    _______: _________ ______
    _________ _______
    _______ _______

    Requirement 3:

    Prepare the stockholders' equity section of the company's balance sheet as of December 31, 2009
    KOHLER CORPORATION
    Stockholders' Equity Section of the Balance Sheet
    December 31, 2009

    Common stock-$20 pare value, 100,000 share authorized, 50,000 shares issued and outstanding $ ________________
    Paid-in capital in excess of pare value, common stock ________________
    Retained Earnings _________________
    Total stockholders' equity $ _________________

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    https://brainmass.com/business/dividends-stock-repurchase-and-policy/journal-entries-and-statement-of-retained-earnings-332924

    Solution Summary

    The solution explains the journal entries for the given equity transactions and how to prepare a statement of retained earnings.

    $2.19