2. Kohler Corporation reports the following components ofstockholders’ equity on December 31, 2016:
|
Common stock—$15 par value, 100,000 sharesauthorized,
45,000 shares issued and outstanding | $675,000 |
| Paid-in capital in excess of par value, commonstock | 60,000 |
| Retained earnings | 430,000 |
| Total stockholders' equity | $1,165,000 |
|
In year 2017, the following transactions affected its stockholders’equity accounts.
| Jan. | 1 | Purchased 5,500 shares of its own stock at $15 cash pershare. |
| Jan. | 5 | Directors declared a $4 per share cash dividend payable onFebruary 28 to the February 5 stockholders of record. |
| Feb. | 28 | Paid the dividend declared on January 5. |
| July | 6 | Sold 2,063 of its treasury shares at $19 cash per share. |
| Aug. | 22 | Sold 3,437 of its treasury shares at $12 cash per share. |
| Sept. | 5 | Directors declared a $4 per share cash dividend payable onOctober 28 to the September 25 stockholders of record. |
| Oct. | 28 | Paid the dividend declared on September 5. |
| Dec. | 31 | Closed the $428,000 credit balance (from net income) in theIncome Summary account to Retained Earnings. |
Required:
1. Prepare journal entries to record each of thesetransactions for 2017.
2. Prepare a statement of retained earnings forthe year ended December 31, 2017.
3. Prepare the stockholders' equity section of thecompany’s balance sheet as of December 31, 2017.
