prepare the stockholders equity section of the balance sheet at december 31 2012 581399

On January 1, 2012, Beacham Inc. had the following shareholders’ equity balances.

Common Stock, no par value (1,000,000 shares issued)

$3,000,000

Common Stock Dividends Distributable

400,000

Retained Earnings

1,200,000

During 2012, the following transactions and events occurred.

1. Issued 100,000 shares of common stock as a result of a 10% stock dividend declared on December 15, 2011.

2. Issued 60,000 shares of common stock for cash at $5 per share.

3. Corrected an error that had understated the net income for 2010 by $140,000.

4. Declared and paid a cash dividend of $300,000.

5. Earned net income of $600,000.

Instructions

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