Rowing Regattas Ltd. is a national organization providing support to Canadian rowers. The following selected accounts appear in the ledger of Rowing Regattas Ltd. on July 1, 2015, the beginning of the current year:
$1.90 preferred shares (750,000 authorized,
42,000 shares issued and outstanding).................................... $1,630,000
Common shares (unlimited authorized,
400,000 shares issued and outstanding).................................. 6,850,000
Retained earnings...................................................................... 5,432,000
Rowing Regattas Ltd. uses dividend accounts. During the year, the corporation completed the following transactions that affected its shareholders' equity.
a. Issued 50,000 common shares in exchange for an office building with a fair market value of $480,000.
b. Declared semiannual cash dividends of $0.95 per preferred share and $0.40 per common share.
c. Issued 5,000 preferred shares at $42 per share, receiving cash.
d. Paid the dividend declared in (b).
e. Declared a 3:1 common share split.
f. Declared semiannual cash dividends of $0.95 per preferred share and $0.50 per common share.
g. Recorded closing entries. The net income for the year was $6,330,000.
Instructions
1. Journalize the entries to record the transactions. Identify each entry by letter.
2. Prepare a statement of changes in equity for the year ended June 30, 2016.
3. Prepare the Shareholders' Equity section of the statement of financial position for Rowing Regattas Ltd. as at June 30, 2016.
4. Calculate the basic earnings per share for the year ended June 30, 2016, assuming a weighted average number of common shares of 1,325,000.