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Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:2. Prepare a statement of changes in equity for the year ended December 31, 2021. (Amounts to be deducted should be indic.
a minus sign.)
TACTEX CON TROLS INC.
Statement of Changes in Equity
For Year Ended December 31, 2021
Preferred
Shares
Common
Shares
Retained
Earnings
Total Equity
Balance, January 1
Balance, December 31
%24
3. Prepare the equity section of the company's balance sheet as of December 31, 2021
TACTEX CONTROLS INC.
Equity Section of the Balance Sheet
December 31, 2021
Contributed Capital
Total contributed capital
Total equity
Transcribed Image Text:The balance sheet for Tactex Controls Inc., provincially incorporated in 2018, reported the following components of equity on
December 31, 2019.
Tactex Controls Inc.
Equity Section of the Balance Sheet
December 31, 2019
Contributed capital:
Preferred shares, $2.0 cumulative, unlimited shares authorized;
28,000 shares issued and outstanding
Common shares, unlinited shares authorized; 83,000 shares issued and
outstanding
Total contributed capital
Retained earnings
Total equity
$ 400,000
743,000
$1,143,000
386,000
$1,529, e00
In 2020 and 2021, the company had the following transactions affecting shareholders and the equity accounts
2020
1 Sold 38,00e common shares at $11.44 per share.
5 The directors declared a total cash dividend of $239,000 payable on Feb. 28 to the Feb. 5
shareholders of record. Dividends had not been declared for the years 2018 and 2019. All
of the preferred shares had been issued during 2018.
28 Paid the dividends declared on January 5.
1 Sold preferred shares for a total of $155,000. The average issue price was $25 per share.
31 Closed the dividend accounts along with the $577,600 credit balance in the Incone Surmary
account.
Jan.
Feb.
July
Dec.
2021
Sept.
5 The directors declared the required cash dividend on the preferred shares and a $2.2 per
conmon share cash dividend payable on October 28 to the October 5 shareholders of record.
28 Paid the dividends declared on Septenber 5.
31 closed the Cash Dividends account along with the $544, e00 credit balance in the Incore
Sunnary account.
Oct.
Dec.
Required:
1. Prepare journal entries to record the transactions and closings for 2020 and 2021 The company uses a cash dividends account to
record declared dividends
View transaction list
Journal entry worksheet
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