Question 2 The equity accounts of Marvell Ltd. on January 1, 2020, were as follows. Share Capital—Preference (9%, $50 par, cumulative,10,000 shares authorized, 8,000 shares issued)
Question 2
The equity accounts of Marvell Ltd. on January 1, 2020, were as follows.
Share Capital—Preference (9%, $50 par, cumulative,10,000 shares
authorized, 8,000 shares issued)
?
Share Capital—Ordinary ($1 stated value, 2,000,000 shares authorized,
1,000,000 shares issued)
?
Share Premium—Preference 100,000
Share Premium—Ordinary 1,450,000
During 2020, the corporation had the following transactions and events pertaining to its equity.
Jan 25 Purchased 20,000 ordinary shares for the treasury at a cost of $2.5 per share.
Feb. 1 Issued 50,000 ordinary shares for $152,000.
Apr. 14 Reissued 10,000 treasury shares—ordinary for $42,000.
Nov. 10 Purchased 1,000 ordinary shares for the treasury at a cost of $6 per share.
Dec. 31 Determined that net income for the year was $452,000. Close the income summary
account.
Dec. 31 Declared a dividend of $0.5 per ordinary share, to be payable in April 2021. Dividend
for the
Instructions
(a.) Journalize the transactions and the closing entry for net income and dividend.
(b.) Prepare the equity section of the
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