Smart Tech Inc.'s shareholders' equity on December 31, 2014, was as follows:
Shareholders' Equity
Share Capital:
Preferred Shares, $1 accumulated deferred dividends,
150,000 shares authorized, 50,000 issued and outstanding .......................$1,000,000
Common Shares, unlimited number of shares authorized,
100,000 shares issued and outstanding ..............................................$2,000,000
Retained Earnings ..........................................................................450,000
Total Shareholders' Equity ............................................................$3,450,000
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 Smart Tech Inc. statement of financial position as of December 31, 2015.