Original Octave Inc. (OOI) is a widely held, publicly traded company that designs equipment for tuning musical instruments. Information pertaining to its shareholders€™ equity is as follows.

The preferred share dividend was not paid in 2011. Several transactions affecting shareholders€™ equity took place during the fiscal year ended December 31, 2012, and are summarized in chronological order as follows.
1. Exchanged 10,000 common shares for a prototype piano tuning machine. The machine was appraised at $110,000. On the transaction date, OOI€™s shares were actively trading at $10 per share.
2. Purchased and retired 10,000 common shares at $15 per share.
3. Paid the annual dividend on the preferred shares. The common shares were then paid a $2 per share dividend.
Instructions
Prepare journal entries for each of the three transactions.

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ORIGINAL OCTAVE INC. Shareholders' Equity December 31, 2011 Share capital Preferred shares, no par value, $8, cumulative, and participating (20,000 authorized; 1,000 issued and outstanding) Common shares, no par value $100,000 (1,000,000 authorized; 40,000 issued and outstanding) Contributed capital, preferred share retirement 500,000 20,000 620,000 280,000 $900,000 Retained earnings Shareholders' equity