Houle Ltd. was incorporated on January 15, 2020, and was authorized to issue 2,200,000 common shares and an unlimited amount of 14% fixed dividend, cumulative, retractable, non-participating, non-voting preferred shares. During the remainder of 2020, the company entered into the following transactions. 1. 2. 3. 4. Houle issued 450,000 common shares in exchange for $7,830,000 in cash. A total of 220,000 preferred shares were issued for $11 a share. A dividend was declared on the preferred shares. A $0.26 dividend per share was declared on the common shares. The dividend on the preferred shares was paid. The dividend on the common shares was paid. The company had net income of $2,270,000 for the year. The closing entries for net income and the dividends declared accounts were prepared. 5. 6. 7. Prepare journal entries to record the above transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) No. Account Titles and Explanation Debit Credit 1. Cash 7,830,000 Common Shares 7,830,000 2. Cash 2,420,000 Preferred Shares 2,420,000 3. Dividends Declared - Preferred Shares 338,800 Dividends Payable 338,800 4. Dividends Declared - Common Shares 117,000 Dividends Payable 117,000 5. Dividends Payable 338,800 Cash 338,000 6. Dividends Payable 117,000 Cash 117,000 7. Income Summary 2,270,000 Retained Earnings 2,270,000 (To close income summary) Retained Earnings Dividends Declared - Preferred Shares Dividends Declared - Common Shares (To close dividends declared) Prepare the shareholders' equity section of the statement of financial position as at December 31, 2020. Shareholders' Equity, December 31, 2020 Total Shareholders' Equity Common Shares $ Preferred Shares Retained Earnings Total Shareholders' Equity $