on january 1 2012 cornell corporation had these stockholders equity accounts 535300

On January 1, 2012, Cornell Corporation had these stockholders” equity accounts.

During the year, the following transactions occurred.

Jan. 15 Declared a $0.50 cash dividend per share to stockholders of record on

January 31, payable February 15.

Feb. 15 Paid the dividend declared in January.

Apr. 15 Declared a 10% stock dividend to stockholders of record on April 30, distributable May 15. On April 15, the market price of the stock was $14 per share.

May 15 Issued the shares for the stock dividend.

Dec. 1 Declared a $0.60 per share cash dividend to stockholders of record on

December 15, payable January 10, 2013.

31 Determined that net income for the year was $400,000.

Instructions

(a) Journalize the transactions. (Include entries to close net income and dividends to Retained Earnings.)

(b) Enter the beginning balances and post the entries to the stockholders” equity T accounts.

(Note: Open additional stockholders” equity accounts as needed.)

(c) Prepare the stockholders” equity section of the balance sheet at December 31.

(d) Calculate the payout ratio and return on common stockholders” equity ratio.