Reference no: EM131696275

Question - On December 31, 2015, Raleigh Corp. had the following balances (all balances are normal):

Accounts Amount

Preferred Stock, ($100 par value, 5% noncumulative, 50,000 shares authorized, 10,000 shares issued and outstanding) $1,000,000

Common Stock ($10 par value, 200,000 shares authorized, 100,000 shares issued and outstanding) $1,000,000

Paid-in Capital in Excess of par, Common 150,000

Retained Earnings 700,000

The following events occurred during 2015 and were not recorded:

1. On January 1, Raleigh Corp. declared a 5% stock dividend on its common stock when the market value of the common stock was $15 per share. Stock dividends were distributed on January 31 to shareholders as of January 25.

2. On February 15, Raleigh Corp.  reacquired 1,000 shares of common stock for $20 each.

3. On March 31, Raleigh Corp. reissued 250 shares of treasury stock for $25 each.

4. On July 1, Raleigh Corp. reissued 500 shares of treasury stock for $16 each.

5. On October 1, Raleigh Corp. declared full year dividends for preferred stock and $1.50 cash dividends for outstanding shares and paid shareholders on October 15.

6. On December 15, Raleigh Corp. split common stock 2 shares for 1.

7. Net Income for 2015 was $275,000.

Requirements:

1. Prepare journal entries for the transactions listed above.

2. Prepare a Stockholders' section of a classified balance sheet as of December 31, 2015.