Fierra Sceptre Inc. was authorized to issue 50,000 $1.50 preferred shares and 300,000 common shares. During 2017, its first year of operations, the following selected transactions occurred:

Required
a. Journalize the above transactions.
b. Prepare the equity section of Fierra Sceptre Inc.’s balance sheet at December 31, 2017.
c. The preferred shares are described as “$1.50 preferred shares.” Explain what the $1.50 means.

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Jan. 1 Feb. 5 Mar. 20 5,000 of the preferred shares were issued at $12.00 per share; cash. 15,000 of the common shares were issued for a total of $126,000; cash. 3,000 of the common shares were given to the organizers of the corporation regarding their efforts. The shares were valued at a total of $28,800. May 15 12,000 preferred shares and 20,000 common shares were issued at $13.20 and $9.60 respectively; cash. Dec. 31 The Income Summary account was closed; it showed a debit balance of $329,000. December 31 is Fierra's year-end.