The annual report for Sneer Corporation disclosed that the company declared and paid preferred dividends in the amount of $280,000 in the current year. It also declared and paid dividends on common...

The annual report for Sneer Corporation disclosed that the company declared and paid preferred dividends in the amount of $280,000 in the current year. It also declared and paid dividends on common stock in the amount of $1.20 per share. During the current year, Sneer had 1 million common shares authorized; 480,000 shares had been issued; and 262,000 shares were in treasury stock. The opening balance in Retained Earnings was $720,000 and Net Income for the current year was $220,000.



Required:

1. Prepare journal entries to record the declaration, and payment, of dividends on (a) preferred and (b) common stock.


2. Using the information given above, prepare a statement of retained earnings for the year ended December 31.


3. Prepare a journal entry to close the dividends account.