Reference no: EM132843883

Jeff Bowman organized Version Corporation in January 2014. The corporation issued one third of its 120 000 authorized shares of no par value common stock at $20 per share. On January 7, 2016, the corporation sold at $120 each 5 000 shares of $9, no-par value, cumulative preferred stock (with unlimited shares authorized). Version suffered losses in its first two years, reporting a deficit of $320 000 at the end of 2015. During 2016 and 2017 combined, the company earned a total of $950 000. Dividends of $1.50 per share were paid on common stocks in 2016 and $4.50 per share in 2017. Preferred shares were paid as required in 2016 and 2017.

Problem 1: The retained earnings (deficit) as of December 31, 2017 for each case (show your work). Then, prepare the shareholders' equity section of the balance sheet for each corporation at December 31, 2017.