On January 1, 2015, Conway Ltd., a private company, had the following shareholders' equity accounts:

Preferred shares, $5 noncumulative, unlimited number authorized, none issued

Common shares, unlimited number authorized, 1.5 million issued .............$1,500,000

Retained earnings .........................................................................1,900,000

The following selected transactions occurred during 2015:

Jan. 2 Issued 100,000 preferred shares at $100 per share.

Feb. 8 Issued 50,000 common shares in exchange for land. On this date, the value of the land was $105,000. The common shares have not recently traded but the last time they traded, they sold for $2.50 per share.

Mar. 5 Declared the quarterly cash dividend to preferred shareholders of record on March 20, payable April 1.

Apr. 18 Issued 200,000 common shares at $3 per share.

June 5 Declared the quarterly cash dividend to preferred shareholders of record on June 20, payable July 1.

Sept. 5 Declared the quarterly cash dividend to preferred shareholders of record on September 20, payable October 1.

Dec. 5 Declared the quarterly cash dividend to preferred shareholders of record on December 20, payable January 1.

14 Declared a cash dividend of $0.50 per share to the common shareholders of record on December 29, payable January 10.

31 Profit for the year was $1 million.

Instructions

(a) Record the above transactions for 2015, including any entries required to close dividends and profit to Retained Earnings.

(b) Open T accounts and post to the shareholders' equity accounts.

(c) Prepare a statement of retained earnings for the year.

(d) Prepare the shareholders' equity section of the statement of financial position at December 31.

(e) Conway is a private company following ASPE. If it followed IFRS instead, how might your answers in parts (a) through (d) change?