Capri Classic Inc. has the following balances in its shareholders' equity accounts as at October 31, 2015:
Retained earnings ..............................................$2,561,000
Common shares .................................................. 985,000
Preferred shares .................................................. 298,000
Accumulated other comprehensive income ................... 32,000
During the fiscal year ended October 31, 2016, Capri Classic Inc. issued preferred shares of $25,000, recorded net income of $1,582,000, a loss on revaluation of assets of $12,000, issued common shares of $138,000, declared a 3:1 share split, declared cash dividends of $32,000 on the preferred shares and $28,000 on the common shares, and discovered that $24,000 of rent expense in May 2014 had been debited to prepaid rent in error. Capri Classic Inc. has a 29% income tax rate.
Instructions
1. Journalize the correction of the error from May 2014.
2. Prepare a statement of changes in equity for the year ended October 31, 2016.