Reference no: EM132902403
Question - Purple Corporation has authorized share capital of 1 million common shares and 400,000 preferred shares. On January 1, 2020, the balance in its shareholders equity included:
9,000 common shares valued at $52,000, 3,500 preferred shares valued at $54,000 and Retained earnings of $65,000.
Profit for the year ending December 31, 2020 was $38,000. No dividends were declared or paid to any shareholders during 2020.
During 2020, Purple Corporation had the following share transactions:
May 1 Issued 12,000 common shares for $9 each.
July 30 Issued 2,700 preferred shares for $18 each.
Oct 8 Issued 35,000 common shares in exchange for Building valued at $450,000.
Required -
a) Journalize the share transactions during 2020.
b) Prepare the equity section of Purple Corporation's balance sheet at December 31, 2020?
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