Chapter 15: Manitoba Deck System Corporation (MDSC) is a public company whose shares are actively traded on the Toronto Stock Exchange. Its Balance Sheet as at year end December 31, 2016 includes the shareholders' equity section as follows: Common shares, 5,000,000 shares issued and outstanding $50,000,000 $1 preferred shares, 1,000,000 shares outstanding (since 2013), cumulative and partly participative $8,500,000 Contributed surplus on repurchase/retirement of $1 preferred shares $15,720 Contributed surplus on repurchase/retirement of common shares $84,000 Contributed surplus on expired options common shares $65,000 Retained earnings $27,500,000 During the fiscal year ended December 31, 2017, the following transactions took place: 1. January 1: Purchased and retired 50,000 common shares for $12.5 per share. 2. February 1: the company issued 35,000 common shares having a market value of $8.40 for the purchased of an equipment having an appraisal value of $300,000. 3. March 1: Issue of subscription for 200,000 common shares at $9.50 per share. Subscribers were to pay $3 per share on March 1 (the issue was fully subscribed) and the balance on July 1. 4. July 1: 100,000 subscribers failed to pay the second instalment and forfeited their initial deposit to the company. The rest paid the second instalment of $6.50 per share subscribed. Shares were issued after full payment was received on the shares subscribed and paid. 5. August 1: Declared and distributed a 10% stock dividend on common shares valued at $11.00 per share after the dividend (ex-dividend) 6. December 31: Declared a cash dividend of $20 million to all shares outstanding as at December 31. The preferred shares participate in any excess dividend with common shares after the common shareholders initially receive $1.50 per common share. No dividends had been declared for 2015 and 2014. Instructions 2} (a) Prepare journal entries to record the transactions above. ABC (b) Prepare the closing entries for the income summary and dividends at December 31, 2017