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Before preparing financial statements for the current year, the chief accountant for Pharoah Ltd$.$ provided the following information regarding the accounting for dividends and stock splits:

$1.$ Pharoah has $\backslash (21,200,\backslash$$ $4\backslash )$ noncumulative preferred shares issued. It paid the preferred shareholders the quarterly dividend, and recorded it as a debit to Dividends Expense and a credit to Cash.

$2.$ A $\backslash (5\backslash \%\backslash )$ stock dividend of the current $21,200$ outstanding common shares was declared when the fair value per share was $\backslash (\backslash$$ $12\backslash ).$ To record the declaration, Retained Earnings was debited and Dividends Payable was credited. The shares have not been issued yet.

$3.$ The company declared a $2-$for$-1$ stock split on its $21,200,\backslash (\backslash$$ $4\backslash )$ noncumulative preferred shares. The average per share amount of the preferred shares before the split was $\backslash (\backslash$$ $70\backslash ).$ The split was recorded as a debit to Retained Earnings of $\backslash (\backslash$$ $1,484,000\backslash )$ and a credit to Preferred Shares of $\backslash (\backslash$$ $1,484,000\backslash ).$

Determine if each of the above transactions was recorded correctly and, if not, prepare the correct entry. $($Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select $"$No Entry" for the account titles and enter $0$ for the amounts. List all debit entries before credit entries.$)$

Correctly recorded?

$1.$

$2.$

$3.$

No$.$ Date

Account Titles

Debit

Credit

$1.$ Dec.

$31$

$2.$ Dec.

$3.$ Dec.

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