70.2K

Verified Solution

Link Copied!

Zen Aerospace Corporation reported the following equity account balances on December 31, 2016:
Preferred shares, $3.60 cumulative, unlimited shares authorized	$ 0
Common shares, unlimited shares authorized, 29,500 shares issued and outstanding	814,200
Retained Earnings	343,000
In 2017, the company had the following transactions affecting shareholders and the shareholders equity accounts:

Required 1. Prepare journal entries to record the transactions and closings for 2017 (assume the retirements were the first ever recorded by Zen Aerospace). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

1.Record the retirement of shares.

2.Record the declaration of common shares stock dividend. Assume Company is using Share Dividend.

3.Record the recording of common shares stock dividend.

4.Record the distribution of common shares stock dividend.

5.Record the issuance of preferred shares.

6.Record the cash dividend. Assume Company is using Cash Dividend.

7.Record the payment of cash dividend.

8.Record to close profit to retained earnings.

9.Record the closure of dividend accounts.

2. Prepare the statement of changes in equity for the year ended December 31, 2017. (Amounts to be deducted should be indicated by a minus sign. Round the final answer to the nearest whole dollar.)

	ZEN AEROSPACE CORPORATION Statement of Changes in Equity For Year Ended December 31, 2017 Preferred Shares Common Shares Retained Earnings Total Equity Balance, January 1 $0 0 0 0 0 0 0 Balance, December 31 $0 $0 $0 $0

Par method for journal entries

Jan. 1 Purchased and retired 3,900 common shares at $36 per share 14 The directors declared a 11% share dividend distributable on February 5 to the January 30 shareholders of record. The shares were trading at $47.50 per share. 30 Date of record regarding the 11% share dividend Feb. 5 Date of distribution regarding the 11% share dividend July 6 Sold 6,900 preferred shares at $79 per share Sept. 5 The directors declared a total cash dividend of $48,018 payable on October 5 to the September 20 shareholders of record. Oct. 5 The cash dividend declared on September 5 was paid Dec. 31 Closed the $484,600 credit balance in the Profit Summary account to Retained Earnings 31 Closed the dividend accounts. Jan. 1 Purchased and retired 3,900 common shares at $36 per share 14 The directors declared a 11% share dividend distributable on February 5 to the January 30 shareholders of record. The shares were trading at $47.50 per share. 30 Date of record regarding the 11% share dividend Feb. 5 Date of distribution regarding the 11% share dividend July 6 Sold 6,900 preferred shares at $79 per share Sept. 5 The directors declared a total cash dividend of $48,018 payable on October 5 to the September 20 shareholders of record. Oct. 5 The cash dividend declared on September 5 was paid Dec. 31 Closed the $484,600 credit balance in the Profit Summary account to Retained Earnings 31 Closed the dividend accounts

Answer & Explanation Solved by verified expert

See Answer