Reference no: EM132602009
Manfred Incorporated is authorized to issue 70,000 no par value, $6 cumulative preferred shares, and an unlimited number of no-par value common shares. The following transactions (among others) occurred during the first year of operations:
Jan. 4 Issued 10,000 common shares to the organizers of the corporation in exchange for accounting and legal services valued at $40,000
Jan. 6 Issued for cash 20,000 common shares at $15 per share.
Jun. 4 Acquired land valued at $49,000 in exchange for 3,500 preferred shares.
Nov. 15 The first annual dividend was declared on the preferred shares of $4. It is to be paid on December 20th.
Dec. 20 Paid the cash dividend declared on November 15th.
Dec. 31 Closed the income summary account which has a credit balance of $148,000.
Dec. 31 Closed the dividend accounts.
Required:
Question 1: Record the above journal entries
Question 2: Prepare the equity section of Modern Electronics' balance sheet at December 31, 2020
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