Prepare a statement of retained earnings for the year ended

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Question - The annual report for Sneer Corporation disclosed that the company declared and paid preferred dividends in the amount of $190,000 in the current year. It also declared and paid dividends on common stock in the amount of $2.90 per share. During the current year, Sneer had 1 million common shares authorized; 390,000 shares had been issued; and 181,000 shares were in treasury stock. The opening balance in Retained Earnings was $890,000 and Net Income for the current year was $390,000.

Required -

1. Prepare journal entries to record the declaration, and payment, of dividends on (a) preferred and (b) common stock.

2. Using the information given above, prepare a statement of retained earnings for the year ended December 31.

3. Prepare a journal entry to close the dividends account.

Reference no: EM133141681

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