Comprehensive Problem 4 Part 1: Journalize Selected transactions completed by Equinox Products Inc. during the fiscal year ended December 31, 2013, were as follows: 1. Journalize the selected transactions. If no entry is required, select "No Entry Required" from the dropdown and leave the amount boxes blank. For a compound transaction, if an amount box does not require an entry, leave it blank. a. Issued 15,000 shares of $20 par common stock at $30, receiving cash. Description Debit Credit b. Issued 4,000 shares of $80 par preferred 5% stock at $100, receiving cash. Description Debit Credit c. Issued $500,000 of 10-year, 5% bonds at 104, with interest payable semiannually. Description Debit Credit d. Declared a quarterly dividend of $0.50 per share on common stock and $1.00 per share on preferred stock. On the date of record, 100,000 shares of common stock were outstanding, no treasury shares were held, and 20,000 shares of preferred stock were outstanding. Description Debit Credit Common stock Preferred stock e. Paid the cash dividends declared in (d). Description Debit Credit f. Purchased 7,500 shares of Solstice Corp. at $40 per share, plus a $150 brokerage commission. The investment is classified as an available-for-sale investment. Description Debit Credit g. Purchased 8,000 shares of treasury common stock at $33 per share. Description Debit Credit h. Purchased 40,000 shares of Pinkberry Co. stock directly from the founders for $24 per share. Pinkberry has 125,000 shares issued and outstanding. Equinox Products Inc. treated the investment as an equity method investment. Description Debit Credit i. Declared a $1.00 quarterly cash dividend per share on preferred stock. On the date of record, 20,000 shares of preferred stock had been issued. Description Debit Credit j. Paid the cash dividends to the preferred stockholders. Description Debit Credit k. Received $27,500 dividend from Pinkberry Co. investment in (h). Description Debit Credit l. Purchased $90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, at their face amount plus accrued interest of $375. The bonds are classifed as a held-to-maturity long-term investment. Description Debit Credit m. Sold, at $38 per share, 2,600 shares of treasury common stock purchased in (g). Description Debit Credit n. Received a dividend of $0.60 per share from the Solstice Corp. investment in (f). Description Debit Credit o. Sold 1,000 shares of Solstice Corp. at $45, including commission. Description Debit Credit p. Recorded the payment of semiannual interest on the bonds issued in (c) and the amortization of the premium for six months. The amortization is determined using the straight-line method. Description Debit Credit q. Accrued interest for three months on the Dream Inc. bonds purchased in (l). Description Debit Credit r. Pinkberry Co. recorded total earnings of $240,000. Equinox Products recorded equity earnings for its share of Pinkberry Co. net income. Description Debit Credit s. The fair value for Solstice Corp. stock was $39.02 per share on December 31, 2014. The investment is adjusted to fair value, using a valuation allowance account. Assume Valuation Allowance for Available-for-Sale Investments had a beginning balance of zero. Description Debit Credit - After all of the transactions for the year ended December 31, 2013, had been posted [including the transactions recorded in part (1) and all adjusting entries], the data below were taken from the records of Equinox Products Inc. http://i.imgur.com/1GjdtSn.gif (also uploaded) On your own paper, in the working papers, or using a spreadsheet, prepare the following: a. Prepare a multiple-step income statement for the year ended December 31, 2013, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were $100,000. (Round earnings per share to the nearest cent.) Save your calculations and enter the requested amounts below. b. Prepare a retained earnings statement for the year ended December 31, 2013. Save your calculations and enter the requested amounts below. c. Prepare a balance sheet in report form as of December 31, 2013. Save your calculations and enter the requested amounts below. If required, only use the minus sign to indicate net loss before income tax, net loss, or a deficit balance in retained earnings. Gross profit Total selling expenses Total administrative expenses Total operating expenses Income from operations Net other expenses and income Income tax Net income Earnings per common share (rounded to the nearest cent) Retained earnings, January 1, 2013 Total current assets Investment in Dream Inc. bonds Total property, plant, and equipment Total assets Total current liabilities Net long-term liabilities Total liabilities Total paid-in capital preferred 5% stock Total paid-in capital common stock, $20 par Total paid-in capital Retained earnings, December 31, 2013 Total stockholders' equity