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Included in the December 31, 2015, Jacobi Company balance sheet was the following shareholders’ equity section:

  

Jacobi   Company

 

Balance   Sheet (Shareholders' Equity)

 

December   31, 2015

       

1

Contributed Capital:

 

2

Preferred stock, 6%, $100 par

$200,000.00

 

3

Additional paid-in capital on   preferred stock

12,000.00

$212,000.00

 

4

Common stock, $5 par

$150,000.00

 

5

Additional paid-in capital on   common stock

240,000.00

390,000.00

 

6

Total contributed capital

$602,000.00

 

7

Retained earnings

627,000.00

 

8

Accumulated other comprehensive   income (loss):

 

9

Unrealized decrease in value of   available-for-sale securities

(41,000.00)

 

10

Total contributed capital,   retained earnings, and accumulated other comprehensive income

$1,188,000.00

 

11

Less: Treasury stock (1,000   shares of common stock at cost, acquired on 2/3/2015)

(20,000.00)

 

12

Total Shareholders’ Equity

$1,168,000.00

The company engaged in the following stock transactions during 2016:

     

Jan.

4

Paid the semiannual dividend on the outstanding   preferred stock and a $1.60 per share annual dividend on the outstanding   common stock. These dividends had been declared on December 1, 2015.

  

5

Issued 500 shares of preferred stock at $110 per   share.

  

22

Issued 4,000 shares of common stock at $23 per   share.

 

Apr.

2

Reissued 700 shares of treasury stock at $24 per   share.

 

May

14

Declared a 10% stock dividend on the outstanding   common stock, payable on June 29. The common stock is currently selling for   $25 per share.

 

Jun.

4

Declared the semiannual cash dividend on the   outstanding preferred stock, payable on July 5.

  

29

Issued the stock dividend declared on May 14.

 

Jul.

5

Paid the cash dividend declared on June 4.

  

20

Split the common stock 2-for-1 and reduced the   par value to $2.50 per share.

 

Aug.

3

Declared a property dividend, payable to common   shareholders on September 14. The dividend consists of an available-for-sale   investment in 50 Drot Company bonds. The bonds had been acquired for $45,000,   but have a carrying value of $30,000. The bonds are currently selling for   $20,000.

 

Sep.

14

Paid the property dividend declared on August 3.

 

Dec.

3

Declared the semiannual cash dividend on the   outstanding preferred stock and a $0.90 per share annual dividend on the   outstanding common stock.

Required:

  

1.

Prepare   journal entries to record the preceding transactions.

 

2.

Prepare   the December 31, 2016, shareholders’ equity section (assume that 2016 net   income was $270,000).

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