Secord Limited has two classes of shares outstanding: preferred ($6 dividend) and common. At December 31, 2013, the following accounts and balances were included in shareholders' equity:
Preferred shares, 300,000 shares issued (authorized, 1,000,000 shares) ................ $ 3,000,000
Common shares, 1,000,000 shares (authorized, unlimited) ............................... 10,000,000
Contributed surplus-preferred .................................................................. 200,000
Contributed surplus-common ............................................................... 17,000,000
Retained earnings ................................................................................ 5,500,000
Accumulated other comprehensive income .................................................... 250,000
The contributed surplus accounts arose from net excess of proceeds over cost on previous cancellations of shares of each respective class. The following transactions affected shareholders' equity during 2014:
Jan. 1 Issued 25,000 preferred shares at $25 per share.
Feb. 1 Issued 50,000 common shares at $20 per share.
June 1 Declared a 2-for-1 stock split (common shares).
July 1 Purchased and retired 30,000 common shares at $15 per share.
Dec. 31 Net income is $2.1 million; comprehensive income is $2,050,000.
Dec. 31 The preferred dividend is declared, and a common dividend of $0.50 per share is declared.
Assume that Secord follows IFRS.
Instructions
(a) Prepare the statement of changes in shareholders' equity and the shareholders' equity section of the statement of financial position for the company at December 31, 2014. Show all supporting calculations.
(b) How would the answer to part (a) be different if Secord followed ASPE?