The following section is taken from Silk Ltd’s statement of financial position at 31 December 2016. 

Additional information:

1. Equity was $5 225 000 at 31 December 2015.

2. Silk Ltd’s profit for the year ended 31 December 2016 was $60 000.

3. Cash dividends declared for the year ended 31 December 2016 were $31 000.

4. The directors of the company approved a transfer of $20 000 to reserves. This was recorded in the ledger and is the only item affecting reserves during the year.

Required

(a) Journalise the dividends declared.

(b) Calculate the dividend payout.

(c) Calculate the return on ordinary shareholders’ equity.

(d) Prepare a statement of changes in equity for the year ended 31 December 2016.