(Learning Objective 2: Preparing shareholders’ equity section of a balance sheet)

Honcho Sporting Goods is authorized to issue 7,000 preference shares and 16,000 ordinary shares. During a two-month period, Honcho completed these share-issuance transactions:

❙ Requirement 1. Prepare the shareholders’ equity section of the Honcho Sporting Goods balance sheet for the transactions given in this exercise. The Retained Earnings account currently has a balance of €45,000. Journal entries are not required.