The Courtney Corporation has the following accounts in its stockholders' equity section at the beginning of 2007: Preferred Stock, $100 par value,
7% cumulatove and nonparticipating, 5,000 shares
authorized, 4,000 shares issued and outstanding
(one year's dividends in arrears)$400,000
Common stock, $5 par value, 35,000 shares authorized,
15,000 shares issued and outstanding$75,000
Paid-in Capital in Excess of ParCommon$300,000
Retained earnings$1,080,000
During 2007, Courtney Corporation declared and distributed the following dividends in the order shawn:
1. The arrears dividend and the current dividend on preferred and a $3 per share common dividend.
2. A 15% stock dividend on common stock, current market price is $28 per share.
3. A $2 per share dividend on common stock outstanding.
Instructions:
Prepare journal emtries for the declaration and distribution od each dividend. (Assume each dividend id distributed prior to the declaration of the subsequent dividend.)