Fundamental Accounting Principles 22th Edition by John Wild ,Ken Shaw,Barbara Chiappetta

Exercise 51

Kohler Corporation reports the following components of stockholders' equity on December 31, 2015:

In year 2016, the following transactions affected its stockholders' equity accounts.
Jan. 1 Purchased 4,000 shares of its own stock at $20 cash per share.
Jan. 5 Directors declared a $2 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 1,500 of its treasury shares at $24 cash per share.
Aug. 22 Sold 2,500 of its treasury shares at $17 cash per share.
Sept. 5 Directors declared a $2 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 $388,000 credit balance (from net income) in the Income Summary account to Retained Earnings.
Required
1. Prepare journal entries to record each of these transactions for 2016.
2. Prepare a statement of retained earnings for the year ended December 31, 2016.
3. Prepare the stockholders' equity section of the company's balance sheet as of December 31, 2016.