Reference no: EM132683148
Below is the statement of shareholder's equity of Kenobi Ltd.: December 31, 2019
Shareholders' equity
Preference share capital (2,000 shares) $98,000
Ordinary share capital (5,500 shares) 120,000
Retained profits 450,000
Total shareholders' equity 668,000
The following transactions happen during 2020:
(a) Apr 3: Issuance of ordinary shares - 1,200 shares @ $30 per share
(b) June 9: Repurchase 750 shares of preference share at $42 per share, out of share capital
(c) Dec 13: Issue 4 bonus ordinary shares for each 10 ordinary shares. The company has decided to capitalize 1/5 of its retained profits for this bonus share issuance.
(d) Net income is $92,400 for the year.
Required:
Problem 1: Prepare the Statement of Changes of Shareholders' Equity and Statement of Shareholders' Equity for year 2020.