(Learning Objective 2: Issuing share and reporting shareholders’ equity) Sweet

& Sour, Inc., is authorized to issue 110,000 shares of ordinary shares and 5,000 shares of preference shares. During its fi rst year, the business completed the following share issuance transactions:

❙ Requirements 1. Journalize the transactions. Explanations are not required.

2. Prepare the shareholders’ equity section of Sweet & Sour’s balance sheet. The ending balance of retained earnings is a defi cit of €47,000.