Earth Star Diamonds Inc. began a potentially lucrative mining operation on October 1, 2020. It is authorized to issue 100,000 shares of $0.60 cumulative preferred shares and 500,000 common shares. The company uses the cash dividends account to keep track of all dividends declared. Part A Required: Prepare journal entries for each of the transactions listed. Oct. 1 Issued for cash, 1,000 shares of the preferred shares at $5.10 each. 10 Issued for cash, 53,000 shares of the common stock at $3.90 per share. 15 Earth star purchased land for $189,000, paying cash of $67,500 and borrowing the balance from the bank (to be repaid in two years). 20 16,500 preferred shares were issued today for total cash proceeds of $93,555. 24 In addition to the declaration of the annual dividend on the preferred shares, dividends of $26,910 were declared on the common shares today, payable November 15, 2020. 31 Revenues of $930,000 were earned during the month; all cash. Expenses, all cash, totalling $315,000 were incurred in October. Close the Income Summary and dividend accounts. View transaction list Journal entry worksheet < 1 2 3 4 5 6 7 8 9 Record the issue of preferred shares. Note: Enter debits before credits. Date October 01, 2020 General Journal Debit Credit Record entry Clear entry View general journal 34 In addition to the declaration of the annual dividend on the preferred proceeds of $9 dividends of $26,910 were declared on the common shares today, payable 2020. 31 Revenues of $930,000 were earned during the month; all cash. Expenses, a totalling $315,000 were incurred in October. Close the Income Sumsary an accounts. View transaction list Journal entry worksheet < 1 8 3 4 5 6 7 8 9 Record the issue of common shares Note: Enter debits before credits Date October 10 2020 M S General Journal Debit Credit C 15 Earth star purchased land for $189,000, paying cash of $67,500 and borrow balance from the bank (to be repaid in two years). 20 16,500 preferred shares were issued today for total cash proceeds of $93, 24 In addition to the declaration of the annual dividend on the preferred shi dividends of $26,910 were declared on the common shares today, payable Nos 2020. 31 Revenues of $930,000 were earned during the month; all cash. Expenses, all totalling $315,000 were incurred in October. Close the Income Summary and accounts. View transaction list Journal entry worksheet a 2 4 5 6 7 8 9 Record the purchase of land in exchange for cash and a note. Note: Enter debits before credits Date October 15 2020 3 L D D tt General Journal Debit Credit 5 12 10 SC 6 < Prev 9 of 10 A & 7 8 W E R T Y U S D LL F G H J Journal entry worksheet < 1 2 3 5 6 7 8 9 Record the issue of preferred shares for cash. Note: Enter debits before credits. Date October 20, 2020 General Journal Debit Credit ournal entry worksheet K 1 2 3 4 $ 6 7 8 9 > Record the dividends declared on common and preferred shares. Note: Enter debits before credits. Date October 24, 2020 General Journal Debit Credit < Prev 9 of 10 N 1 2 3 4 5 7 Record the revenues earned. Note: Enter debits before credits. Date October 31, 2020 pe 8 9 General Journal Debit Credit < Prev 9 of 10 Journal entry worksheet < 1 2 3 4 5 6 8 Record the expenses incurred. Note: Enter debits before credits. Date October 31, 2020 6 General Journal Debit Credit K 1 2 3 4 5 6 7 9 7 Record to close the income summary account. Note: Enter debits before credits. Date October 31, 2020 General Journal Debit Credit < 1 2 3 4 5 6 7 8 D Record to close the cash dividends account, assuming Retained Earnings was not debited directly when dividends were declared. Note: Enter debits before credits. Date October 31 2020 General Journal Debit Credit Required: Based on the transactions in Part A, prepare the balance sheet as at October 31, 2020. EARTH STAR DIAMONDS INC. Balance Sheet October 31, 2020 Assets k Current assets ences Property, plant and equipment Total assets Current liabilities Non current liabilities Total liabilities Contributed Capital Liabilities Equity Total assets Current liabilities Non current liabilities Total liabilities Contributed Capital Total contributed capital Total equity Total liabilities and equity Liabilities Equity