Shohei Inc.'s shareholders' equity on December 31, 2014, was as follows: Shareholders' Equity Share Capital: Preferred Shares,

Question:

Shohei Inc.'s shareholders' equity on December 31, 2014, was as follows:
Shareholders' Equity
Share Capital:
Preferred Shares, $0.75 accumulated deferred dividends,
500,000 shares authorized, 100,000 issued and outstanding ..................... $1,000,000
Common Shares, unlimited number of shares authorized,
250,000 shares issued and outstanding .............................................. $4,000,000
Retained Earnings ....................................................................... 750,000
Total Shareholders' Equity ............................................................ $5,750,000
During 2015, the following transactions occurred.
Jan 2 10,000 preferred shares were issued at $22.00 per share.
Feb 1 12,000 common shares were issued in exchange for a building with a fair value of $300,000.
Nov 25 Declared preferred dividends to be paid on December 23.
Dec 27 Declared 5% common stock dividend, when the market price was $25, to be distributed on January 30, 2016.
Dec 31 Net income for the year was $520,000.
Requirements
1. Journalize the above transactions.
2. Prepare the shareholders' equity section of the Shohei Inc. statement of financial position as of December 31, 2015.
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Financial Accounting

ISBN: 978-0133375534

2nd Canadian edition

Authors: Jeffrey Waybright, Robert Kemp, Sherif Elbarrad

Question Posted: