Reference no: EM132497283

Question - The balance sheet for XYZ Company reported the following components of equity on December 31, 2019:

Common shares, unlimited shares authorized, 20,800 shares issued and outstanding = $376,000

Retained earnings = 224,000

Total equity = $600,000

In 2020, XYZ had the following transactions affecting shareholders and the equity accounts:

Jan. 5: The directors declared a $4.00 per share cash dividend payable on Feb. 28 to the Feb. 5 shareholders of record.

Feb. 28: Paid the dividend declared on January 5.

July 6: Sold 1,150 common shares at $39.20 per share.

Aug. 22: Sold 1,650 common shares at $28.00 per share.

Sept. 5: The directors declared a $4.00 per share cash dividend payable on Oct. 28 to the Oct. 5 shareholders of record.

Oct. 28: Paid the dividend declared on September 5.

Dec. 31: Closed the $348,000 credit balance in the Income Summary account.

Required - Prepare journal entries to record the transactions and closings for 2020. The company uses a Cash Dividends account when dividends are declared.