Reference no: EM132987373
The equity section of the December 31, 2019, balance sheet for Delicious Alternative Desserts Inc. showed the following:
Delicious Alternative Desserts Inc.
Equity Section of the Balance Sheet
December 31, 2019
Contributed capital:
Preferred shares, $0.40 cumulative; 80,000 shares authorized; 60,000 shares issued and outstanding$240,000
Common shares; 250,000 shares authorized; 120,000 shares issued and outstanding 192,000
Total contributed capital$432,000
Retained earnings 148,000
Total equity$580,000
During the year 2020, the company had the following transactions affecting equity accounts:
- Jan.3 Sold 20,000 common shares for a total of $34,400 cash.
- Mar.1 Sold 5,000 preferred shares at $4.80 each; cash.
- June15 Exchanged 7,000 common shares for equipment with a fair market value of $26,000. The last common share trade was dated March 15 at $4.88.
- Dec.31 Closed the Income Summary account, which showed a credit balance of $280,000.
The board of directors had not declared dividends for the past two years (2019 and 2020).
Required:
Problem 1. Journalize the above transactions.