Reference no: EM131796525

Question - Dawls Corporation reported stockholders' equity on December 31 of the prior year as follows:

Common stock, $5 par value 1,000,000

Shares Authorized, 5000,000 shares issued-------- $2,500,000

Paid-in capital in Axcess of par, common stock---------- $1,000,000

Reainted earnings--------------------------------------- $3,000,000

The following selected transactions occurred during the current year:

Feb.15 The board of directors declared a 5% stock dividend to stockholders of record on March 1, Payable March 20. The stock was selling for $8 par share.

Mar. 9 Paid stock dividend.

May. 1 A cash dividend of $0.30 par share was declared by the board of directors to stockholder of record on May 20, Payable June 1.

June. 1 Paid the cash dividend.

Aug. 20 The board decided to split the stock 4-for-1, effective on September 1.

Sept.1 Stock split 4-for-1.

Dec. 31 Earned a net income of $800,000 for the current year.

Prepare a statement of retained earnings as of December 31 of the current Year.