Entries and Shareholders' Equity: On 31 December 20X1, Kingdom Corporation had the following shareholders' equity:

Dividends are two years in arrears on the Series B preferred shares.

The following events and transactions took place during 20X2:

15 Jamuary 25,000 Series A preferred shares were retired for \(\$ 31\) per share.

1 February Issued 80,000 common shares for nachinery with an appraised value of \(\$ 1,600,000\); the shares were estimated to be worth \(\$ 21\) per share.

11 March \(15,000\) Series B preferred shares were retired for \(\$ 116\) per share.

30 April \(60,000\) common shares were retired for \(\$ 22\) per share.

30 December Dividends of \(\$ 810,000\) were declared and paid (indicate the amount of dividend for each share class).

31 December A stock dividend of \(10 \%\) was declared and issued on the common shares. The Board of Directors agreed that the dividend would be recorded at the fair value of the common shares, \(\$ 22\). The dividend involved issuing fractional share rights that, if entirely exercised, would result in the issuance of 500 common shares.

Required:

1. Record all transactions in general journal form.

2. Prepare the shareholders' equity section of the SFP at 31 December 20X2. Assume earnings for the year was \(\$ 1,609,000\).

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Series A preferred shares, no-par, $0.75, cumulative; 480,000 shares issued and outstanding Series B preferred shares, no-par, $0.25, cumulative, participating in dividends with common shares to an additional $0.50 after the common shares have received a $12,100,000 $0.25 matching dividend; 100,000 shares issued and outstanding. Participation is based on relative annual total base dividends. Common shares; 1,200,000 issued and outstanding Contributed capital on retirement of Series B preferred shares Retained earnings 10,500,000 18,600,000 101,000 14,600,000 $55,901,000