Problem - Comparative statements of retained earnings for Renn-Dever Corporation were reported in its 2011 annual report as follows.
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RENN-DEVER CORPORATION Statements of Retained Earnings
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For the Years Ended December 31,
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2011
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2010
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2009
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Balance at beginning of year
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$4,835,045
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$4,271,440
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$4,570,940
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Net income (loss)
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2,192,300
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1,124,500
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(299,500)
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Deductions:
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Stock dividend (35,000 shares)
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242,000
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Common shares retired (114,000 shares)
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212,300
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Common stock cash dividends
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591,921
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348,595
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0
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Balance at end of year
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$6,193,424
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$4,835,045
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$4,271,440
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At December 31, 2008, common shares consisted of the following:
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Common stock, 1,855,000 shares at $1 par
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$1,855,000
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Paid-in capital - excess of par
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7,420,000
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Required: Infer from the reports the events and transactions that affected Renn-Dever Corporation's retained earnings during 2009, 2010, and 2011. Prepare the journal entries that reflect those events and transactions.