Reference no: EM133140674
Question - Cranston Communication Inc. had the following shareholders' equity information on December 31, 2019:
Contributed capital Preferred shares, $2.00, cumulative (1 year in arrears), liquidation price of $20, 100,000 shares authorized, 23,000 shares issued and outstanding $368,000
Common shares, unlimited number of shares authorized, 27,500 shares issued and outstanding 261,250
Total contributed capital 629,250
Retained earnings 530,000
Total shareholders TM equity $1,159,250
The following transactions took place during 2020:
Jan. 14 Declared a $94,000 cash dividend, payable on March 1 to the shareholders of record on February 1. Indicate the amount payable to each class of shareholder.
Feb. 28 Issued 20,000 common shares for $8.00 per share.
Mar. 1 Paid the cash dividend declared on January 14.
Apr. 1 Declared a 20 percent stock dividend on the common shares, distributable on May 2 to the shareholders of record on April 15. The market value of the shares was $8.40 per share.
May 2 Distributed the stock dividend declared on April 1.
Jul. 4 Repurchased 3,400 of the company's own common shares at $8.75 per share.
Sep. 2 Issued 2,900 common shares for $9.25 per share.
Nov. 2 Split the common shares 2 for 1.
Dec. 31 Reported net income of $210,000.
Closed the Income Summary account.
Required -
1. Record the transactions in the general journal.
2. Prepare the statement of shareholders' equity for the year ended December 31, 2020.