Shoshone Enterprises Inc manufactures bathroom fixtures

The st
Shoshone Enterprises Inc. manufactures bathroom fixtures. The stockholders’ equity accounts
of Shoshone Enterprises Inc., with balances on January 1, 2007, are as follows:Common Stock,
$20 stated value (100,000 shares authorized, 75,000 shares issued) ...$1,500,000Paid-In
Capital in Excess of Stated Value ....................180,000Retained Earnings
............................725,000Treasury Stock (5,000 shares, at cost) .....................140,000The
following selected transactions occurred during the year:Jan. 28 Paid cash dividends of $0.80
per share on the common stock. The dividend had been properly recorded when declared on
December 30 of the preceding fiscal year for $56,000.Mar. 21 Issued 15,000 shares of common
stock for $480,000.May 10 Sold all of the treasury stock for $165,000.July 1 Declared a 4%
stock dividend on common stock, to be capitalized at the market price of the stock, which is $36
a share.Aug. 11 Issued the certificates for the dividend declared on July 1.Oct. 20 Purchased
7,500 shares of treasury stock for $255,000.Dec. 27 Declared a $0.75-per-share dividend on
common stock.In addition, Shoshone had net income of $269,400 during the current
year.Instructions1. Enter the January 1 balances in T-accounts for the stockholders’ equity
accounts listed. Also prepare T-accounts for the following: Paid-In Capital from Sale of Treasury
Stock; Stock Dividends Distributable.2. Journalize the entries to record the transactions, and
post to the six selected accounts.3. Prepare a retained earnings statement for the year ended
December 31, 2007.4. Prepare the Stockholders’ Equity section of the December 31, 2007,
balance sheet.View Solution:
Shoshone Enterprises Inc manufactures bathroom fixtures The st
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