Question Details

Indicate the balances in the stockholders' equity 



1
Timber Ridge Corporation was organized on January 1, 2013. During its first year, the corporation issued 40,000 shares of $5 par value preferred stock and 400,000 shares of $1 par value common stock. At December 31, the company declared the following cash dividends:

	2013	$  8,000
	2014	$30,000
	2015	$70,000

Instructions
(a)	Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 5% and not cumulative.
(b)	Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 6% and cumulative.
(c)	Journalize the declaration of the cash dividend at December 31, 2015 using the assumption of part (b).

2
On November 1, 2014, Taxton Corporation's stockholders' equity section is as follows:
	Common stock, $10 par value	$   600,000
	Paid-in capital in excess of par	205,000
	Retained earnings	    240,000
	Total stockholders' equity	$1,045,000
On November 1, Taxton declares and distributes a 15% stock dividend when the market value of the stock is $13 per share.

Instructions
Indicate the balances in the stockholders' equity accounts after the stock dividend has been distributed.




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