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Prepare journal entries to record the transactions

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Reference no: EM132974061

Question - Zen Aerospace Corporation reported the following equity account balances on December 31, 2019:

Preferred shares, $3.60 cumulative, unlimited shares authorized $0

Common shares, unlimited shares authorized, 29,500 shares issued and outstanding  814,200

Retained earnings 343,000

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

Jan. 1 Purchased and retired 3,900 common shares at $36 per share.

Jan. 14 The directors declared an 11% share dividend distributable on February 5 to the January 30 shareholders of record. The shares were trading at $47.50 per share.

Jan. 30. Date of record regarding the 11% share dividend

Feb. 5 Date of distribution regarding the 11% share dividend.

July 6 Sold 6,900 preferred shares at $79 per share.

Sept. 5 The directors declared a total cash dividend of $48,018 payable on October 5 to the September 20 shareholders of record.

Oct. 5 The cash dividend declared on September 5 was paid.

Dec. 31 Closed the $484,600 credit balance in the Profit Summary account to Retained Earnings.

Dec. 31 Closed the dividend accounts.

Required - Prepare journal entries to record the transactions and closings for 2020 (assume the retirements were the f irst ever recorded by Zen Aerospace). Assume share dividends and cash dividends account is used when dividends are declared.

Reference no: EM132974061

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