The equity section of the December 31, 2019, balance sheet for Delicious Alternative Desserts Inc. showed the
Question:
The equity section of the December 31, 2019, balance sheet for Delicious Alternative Desserts Inc. showed the following: Delicious Alternative Desserts Inc. Equity Section of the Balance Sheet December 31, 2019Contributed capital:
Preferred shares, $0.40 cumulative; 80,000 shares authorized;
50,000 shares issued and outstanding $200,000
Common shares; 250,000 shares authorized; 110,000
shares issued and outstanding 176,000
Total contributed capital $376,000
Retained earnings 148,000
Total equity $524,000
During the year 2020, the company had the following transactions affecting equity accounts:
Jan. 3 Sold 10,000 common shares for a total of $17,200 cash.
Mar. 1 Sold 5,000 preferred shares at $3.80 each; cash.
June15 Exchanged 7,000 common shares for equipment with a fair market value of $21,000. The last common share trade was dated March 15 at $4.78.
Dec. 31 Closed the Income Summary account, which showed a credit balance of $270,000. The board of directors had not declared dividends for the past two years (2019 and 2020).
Prepare the equity section as at December 31, 2020.
Fundamental Accounting Principles Volume II
ISBN: 978-1260305838
16th Canadian edition
Authors: Kermit Larson, Tilly Jensen, Heidi Dieckmann