On January 1, 2021, Conway Ltd., a private company, had the following shareholders equity accounts:

Preferred shares, $1.40 noncumulative, unlimited number authorized, none issued

Common shares, unlimited number authorized, 1.5 million issued $3,000,000

Retained earnings 3,800,000

The following selected transactions occurred during 2021:

Jan. 2 Issued 200,000 preferred shares at $25 per share.

Feb. 8 Issued 100,000 common shares in exchange for land. On this date, the fair value of the land was $210,000. The common shares have not recently traded, but the last time they traded, they sold for $2.50 per share.

Mar. 5 Declared the quarterly cash dividend to preferred shareholders of record on March 20, payable April 2.

Apr. 18 Issued 400,000 common shares at $3 per share.

June 5 Declared the quarterly cash dividend to preferred shareholders of record on June 20, payable July 1.

Sept. 5 Declared the quarterly cash dividend to preferred shareholders of record on September 20, payable October 1.

Oct. 4 Issued 40,000 preferred shares at $25 per share.

Dec. 5 Declared the quarterly cash dividend to preferred shareholders of record on December 20, payable January 1.

14 Declared a cash dividend of $0.50 per share to the common shareholders of record on December 31, payable January 10.

31 Net income for the year was $2.3 million.

Instructions

Record the above transactions for 2021, including any entries required to close dividends and net income to Retained Earnings. Open T accounts and post to the shareholders equity accounts. Prepare a statement of retained earnings for the year. Prepare the shareholders equity section of the statement of financial position at December 31. Conway is a private company following ASPE. If it followed IFRS instead, how might your answers in parts (a) through (d) change?