Reference no: EM132526163

On January 1, 2020, Ayayai Ltd. (a public company) had the following shareholders' equity accounts:

Preferred shares, $4

non-cumulative, unlimited number authorized, none issued 0

Common shares, unlimited number authorized, 700,000 issued $3,500,000

Retained earnings 1,100,000

Accumulated other comprehensive income 130,000

The following selected transactions occurred during 2020:

Jan. 2 Issued 80,000 preferred shares at $100 per share.

Mar. 5 Declared the quarterly cash dividend to preferred shareholders of record on March 20, payable April 1.

Apr. 18 Issued 100,000 common shares at $8 per share.

June 5 Declared the quarterly cash dividend to preferred shareholders of record on June 20, payable July 1.

Sept. 5 Declared the quarterly cash dividend to preferred shareholders of record on September 20, payable October 1.

Dec. 5 Declared the quarterly cash dividend to preferred shareholders of record on December 20, payable January 1.

Dec. 31 Net income for the year was $350,000.

Question 1: Prepare journal entries to record the transactions above, as well as the closing entries for Income Summary and Dividends

Question 2: Enter beginning balances and post the entries to the preferred shares , common shares , retained earnings, AOCI ( shareholders' equity ) and dividends T accounts and arrive at the ending balances.

Question 3: Prepare the statement of changes in shareholders' equity for the year

Question 4: Prepare the shareholders' equity section of the SFP at December 31.

Question 5: Prepare the financing activities section of the statement of cash flows for the year ended December 31