Please correct the DEC 1 and DEC 31 transactions in my journal entries-my answer

Question

Please correct the DEC 1 and DEC 31 transactions in my journal entries-my answers are incorrect. Thank you.

*Problem 11-2A (Part Level Submission)

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*(a)

Date

Account Titles and Explanation

Debit

Credit

(To record net income)

(To close cash dividends)

(To record payment of cash dividends payable)

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The stockholders’ equity accounts of Miley Corporation on January 1, 2014, were as follows.
Preferred Stock (6%, $100 par noncumulative, 4,500 shares authorized) $270,000 Common Stock ($4 stated value, 301,300 shares authorized) 964,160 Paid-in Capital in Excess of Par Value—Preferred Stock 10,800 Paid-in Capital in Excess of Stated Value—Common Stock 241,040 Retained Earnings 695,200 Treasury Stock—(4,500 common shares) 36,000

During 2014, the corporation had the following transactions and events pertaining to its stockholders’ equity.

Feb. 1 Issued 5,100 shares of common stock for $30,600. Mar. 20 Purchased 1,640 additional shares of common treasury stock at $7 per share. Oct. 1 Declared a 6% cash dividend on preferred stock, payable November 1. Nov. 1 Paid the dividend declared on October 1. Dec. 1 Declared a $0.80 per share cash dividend to common stockholders of record on December 15, payable December 31, 2014. Dec. 31 Determined that net income for the year was $276,200. Paid the dividend declared on December 1.

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Explanation / Answer

Solution:

Date Journal Debit Credit Dec-01 Retained Earnings 245,120 Dividends payable          245,120 ( $ 0.80 * ( 301,300 + 5,100) ) Dec-31 Dividends payable 245,120 Cash          245,120 Dec-31 Income summary 276,200 Retained Earnings 276,200

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