ILock, Inc., is authorized to issue 450,000 no par value common shares. On January 1, 2021, it offers an issue, on a subscription basis, of 100,000 common shares at $15 per share. Each subscriber is required to pay 40% for the first installment followed by two additional installments of 30% each. On February 1, 2021, the company calls the first installment which is paid by all subscribers. On June 1, the company calls the remaining subscription due. Subscribers for 1,500 shares default and fail to pay. On July 1, the company completes all the procedures for this subscription issue.

Prepare the entries to record all of the transactions listed above, as follows:

a. On January 1.

b. On February 1.

c. Entry on June 1 to record the receipt of the final installment.

d. Entry on June 1 to record the default of payment on the 1,500 share subscriptions, assuming the company confiscates all prior installment payments.

e. Entry on July 1.

f. Entry on August 1 to record the default of payment on the 1,500 share subscriptions, assuming the company refunds all prior instalment payments.

Part B- 

At the beginning of its first year, White Sox Corp. had the following capital structure:

Preferred shares- 5,000 issued, 6% dividend $100,000

Common shares- 8,000 issued $400,000

$500,000

Dividends declared and paid were as follows in its first two years: Yr. 1- $5,000; Yr. 2- $41,000

Required:

Prepare a table showing the number of dividends paid in Yr. 1 and Yr. 2 to each class of shareholder under the following assumptions:

1. The preferred stock is noncumulative and nonparticipating
2. The preferred stock is cumulative and fully participating
3. The preferred stock is cumulative and participates after the common shares receive 8% of their invested capital.