50.1K

Verified Solution

Link Copied!

Accounting for Corporations

Complete all the necessary accounting for a Corporation based on the information below:

Ardmark Corporation is a private corporation that was incorporated on January $1,2019.$ It is authorized to issue an unlimited number of $$10$ stated value preferred shares $($$$2$ dividend$)$ that are cumulative, as well $1,000$ common shares of no par value. The following share transactions were completed during the first year:

$$ Jan. $1$ Issued $100$ common shares for cash at $$40$ per share.

$$ Mar. $21$ Issued $10,000$ preferred shares for land. The land was listed for sale at $$110,000,$ but was valued by a licensed appraiser at $$100,000.$

$$ Apr. $17$th issued $200$ common shares to pay a consultant$$s bill of $$8,000.$

$$ July $23$rd issued $5,000$ preferred shares for cash at $$12$ per share.

$$ Sept. $1$st issued $20$ common shares to a law firm for payment of their bill of $$800$ to file the company$$s incorporation documents.

$$ Sept. $1$st issued $40$ common shares for $$2,000$ cash.

$$ Dec. $18$th issued $6,000$ preferred shares for cash at $$11$ each.

$$ Dec. $20$th declared a $$45,000$ dividend.

$$ Dec. $31$st a cash payment is made to shareholders for their dividend.

Instructions

a$)$ Journalize the transactions.

b$)$ Calculate the year$-$end balance in each of the share capital accounts. T$-$ accounts

c$)$ Prepare a Shareholder$$s Equity section if the balance in Retained Earning is $$500,000.$

Answer & Explanation Solved by verified expert

See Answer