issued 50 000 shares of common stock as a result of a 10 stock dividend declared on 581394

On January 1, 2012, Hammermeister Inc. had the following stockholders’ equity account balances.

Common Stock, no par value (500,000 shares issued)

$1,500,000

Common Stock Dividends Distributable

200,000

Retained Earnings

600,000

During 2012, the following transactions and events occurred.

1. Issued 50,000 shares of common stock as a result of a 10% stock dividend declared on December 15, 2009.

2. Issued 30,000 shares of common stock for cash at $6 per share.

3. Corrected an error that had understated the net income for 2010 by $70,000.

4. Declared and paid a cash dividend of $80,000.

5. Earned net income of $300,000.

Instructions

Prepare the stockholders’ equity section of the balance sheet at December 31, 2012.