Question 2 The ledger of Culver Corporation at December 31 2

Question 2 The ledger of Culver Corporation at December 31, 2017, after the books have been closed, contains the following stockholders\' equity accounts. Preferred Stock (11,400 shares issued) Common Stock (321,000 shares issued) Paid-in Capital in Excess of Par Value-Preferred Stock $1,2.1.,4tki 1,605,000 147,000 1,530,000 2,853,000 Retained Earnings A review of the accounting records reveals this information: 1. Preferred stock is 896, S101 par value, noncumulative. Since January 1, 2016, 11,400 shares have been outstanding; 22,800 shares are authorized 2. Common stock is no-par with a stated value of $5 per share; 642,000 shares are authorized. 3. The January 1, 2017, balance in Retained Earnings was $2,426,000 4. On October 1, 67,000 shares of common stock were sold for cash at $10 per share. 5. A cash dividend of $399,000 was declared and properly allocated to preferred and common stock on November 1. No dividends were paid to preferred stockholders in 2016. 6. Net income for the year was $826,000. 7. On December 31, 2017, the directors authorized disclosure of a $155,000 restriction of retained earnings for plant expansion. (Use Note A.)

Solution

Retained earnings Nov-1 Cash dividends 399000 Jan1-17 beginning balance 2426000 Net income 826000 Dec-31-17 Ending balance 2853000