In 2013, Elizabeth and some of her friends invested money to start a company named LADIEZ Corporation. The following transactions occurred during 2013:

Jan 1	The corporate charter authorized 72,000, $4 cumulative preferred stock and unlimited common stock up to a maximum amount of $21,000,000 to be issued.
Jan 6	Issued 178,000 common shares at $18 per share. Shares were issued to Elizabeth and other investors.
Jan 7	Issued another 540 common shares to Elizabeth in exchange for her legal services in setting up the corporation. The Stockholders agreed that the legal services were worth $9,180.
Jan 12	Issued 4,200 preferred shares for $303,000.
Jan 14	Issued 11,000 common shares in exchange for a building acquired. For this purpose shares were valued at $19.
Nov 15	The first annual dividend on preferred stock was declared.
Dec 20	Paid the dividends declared on preferred stock.

LADIEZ Corporation generated a $145,000 net income during the year. a) Prepare the journal entries to record the above transactions. Do not enter dollar signs or commas in the input boxes.

Date	Account Title and Explanation	Debit	Credit
Jan 6	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense		Answer
	Issued common stock for cash
Jan 7	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense		Answer
	Issued common stock in exchange for services
Jan 12	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense		Answer
	Issue of preferred stock for cash
Jan 14	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense		Answer
	Issued common stock for building
Nov 15	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense		Answer
	Dividend declared on preferred stock
Dec 20	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense	Answer
	AnswerAccounts PayableAccounts ReceivableAdvertising ExpenseBuildingCashCommon StockCommon Stock Dividends DistributableCost of Goods SoldDividends Payable - CommonDividends Payable - PreferredIncome SummaryInterest ExpenseInterest PayableInterest ReceivableInterest RevenueInventoryLandLegal ExpenseNotes PayablePreferred StockPrepaid RentRent ExpenseRetained EarningsSalaries ExpenseSales RevenueSupplies ExpenseTelephone ExpenseTravel ExpenseUtilities Expense		Answer
	Recording payment of dividend

b) Prepare the statement of retained earnings for the year ended December 31, 2013.

LADIEZ Corporation
Statement of Retained Earnings
For the Year Ended December 31, 2013
Opening Balance	Answer
Add: Net Income	Answer
Less: Dividends Paid	Answer
Balance December 31, 2013	Answer

c) Prepare the Stockholders equity section of the balance sheet as at December 31, 2013.

LADIEZ Corporation
Stockholders' Equity
December 31, 2013
Stock Capital
Authorized: 72,000 $4 cumulative preferred stock and unlimited common stock
Issued:
189,540 Common Stock	Answer
4,200, $4 Preferred Stock	Answer
Total Stock Capital	Answer
Retained Earnings	Answer
Total Stockholders Equity	Answer