Redfern Limited reported the following information in its December 31, 2016, annual report: Shareholders' Equity Preferred shares,

Question:

Redfern Limited reported the following information in its December 31, 2016, annual report: Shareholders' Equity

Preferred shares, $2.75, cumulative,

600,000 shares authorized, 100,000 shares issued and outstanding ........... $ 400,000

Common shares, unlimited number of shares

authorized, 1,300,000 shares issued and outstanding ............................. 1,850,000

Retained earnings ..................................................................... 5,850,000

Total shareholders' equity ...........................................................$8,100,000

Required

1. Identify the different issues of shares that Redfern Limited has outstanding.

2. What is the average issue price per preferred share?

3. Make two summary journal entries to record issuance of all the Redfern shares for cash on March 1, 2017. Explanations are not required.

4. Assume no preferred dividends are in arrears. Journalize the declaration of a $400,000 dividend at June 30, 2017. Use separate Dividends Payable accounts for preferred and common shares. An explanation is not required.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...