January 5 The directors resolved to redeem the preference shares (equity) out of the profit, at a premium of $15,000.

150,000 ordinary shares, issued at $1.50, paid to $1

65,000 redeemable preference shares, issued at $1, fully paid

Maintenance reserve $ 200,000

Retained earnings $ 500,000

Required: Prepare general entries with narrations and full working out