The equity section of the December 31, 2019, balance sheet for Delicious Alternative Desserts Inc. showed the following: Delicious Alternative Desserts Inc. Equity Section of the Balance Sheet December 31, 2e19 Contributed capital: Preferred shares, s0.40 cumulative; 80,000 shares authorized; 62,000 shares issued and outstanding Conmon shares; 250,000 shares authorized; 122,000 shares issued and outstanding Total contributed capital Retained earnings $248,000 195,200 $443,200 148,000 $591,200 Total equity During the year 2020, the company had the following transactions affecting equity accounts: 3 Sold 22,00o conmon shares for a total of $37,840 cash. 1 Sold 5,000 preferred shares at $5.00 each; cash. Jan. Mar. June 15 Exchanged 7,000 common shares for equipeent with a fair market value of $27,000. The last connon share trade was dated March 15 at $4.9o. Dec. 31 Closed the Income Sunnary account, which shoved a credit balance of $282,00. The board of directors had not declared dividends for the past two years (2019 and 2020). Required: 1. Journalize the above transactions. 2. Prepare the equity section as at December 31, 2020. (Enter all amounts as positive values.) DELICIOUS ALTERNATIVE DESSERTS INC. Equity Section of the Balance Sheet December 31, 2020 Contributed Capital Total contributed capital Total equity 24 3. How many preferred shares are available for issue at December 31, 202O? Preferred shares
The equity section of the December 31, 2019, balance sheet for Delicious Alternative Desserts Inc. showed the following: Delicious Alternative Desserts Inc. Equity Section of the Balance Sheet December 31, 2e19 Contributed capital: Preferred shares, s0.40 cumulative; 80,000 shares authorized; 62,000 shares issued and outstanding Conmon shares; 250,000 shares authorized; 122,000 shares issued and outstanding Total contributed capital Retained earnings $248,000 195,200 $443,200 148,000 $591,200 Total equity During the year 2020, the company had the following transactions affecting equity accounts: 3 Sold 22,00o conmon shares for a total of $37,840 cash. 1 Sold 5,000 preferred shares at $5.00 each; cash. Jan. Mar. June 15 Exchanged 7,000 common shares for equipeent with a fair market value of $27,000. The last connon share trade was dated March 15 at $4.9o. Dec. 31 Closed the Income Sunnary account, which shoved a credit balance of $282,00. The board of directors had not declared dividends for the past two years (2019 and 2020). Required: 1. Journalize the above transactions. 2. Prepare the equity section as at December 31, 2020. (Enter all amounts as positive values.) DELICIOUS ALTERNATIVE DESSERTS INC. Equity Section of the Balance Sheet December 31, 2020 Contributed Capital Total contributed capital Total equity 24 3. How many preferred shares are available for issue at December 31, 202O? Preferred shares
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Exercise 12-17 Share transactions, distribution of dividends, equity, closing LO1, 2, 3, 4, 5, 6
The equity section of the December 31, 2019, balance sheet for Delicious Alternative Desserts Inc. showed the following:
Delicious Alternative Desserts Inc.
Equity Section of the Balance Sheet
December 31, 2019
Contributed capital:
Preferred shares, $0.40 cumulative; 80, 000 shares authorized; 62,000
shares issued and outstanding
Conmon shares; 250,000 shares authorized; 122,000 shares issued and
outstanding
Total contributed capital
Retained earnings
$248,000
195,200
$443,200
148,000
$591,200
Total equity
During the year 2020, the company had the following transactions affecting equity accounts:
Jan.
Mar.
3 Sold 22,00e0 common shares for a total of $37,840 cash.
1 Sold 5,000 preferred shares at $5.00 each; cash.
June 15 Exchanged 7,000 common shares for equipnent with a fair market value of
$27,000. The last common share trade was dated March 1s at $4.90.
31 Closed the Income Sunnary account, which showed a credit balance of
$282,000.
Dec.
The board of directors had not declared dividends for the past two years (2019 and 2020).
Required:
1. Journalize the above transactions.
2. Prepare the equity section as at December 31, 2020. (Enter all amounts as positive values.)
DELICIOUS ALTERNATIVE DESSERTS INC.
Equity Section of the Balance Sheet
December 31, 2020
Contributed Capital
Total contributed capital
Total equity
24
3. How many preferred shares are available for issue at December 31, 2020?
Preferred shares
4. How many common shares are available for issue at December 31, 2020?
Common shares
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