Question
On January 1, 2021,SunlandLtd. had the following shareholders' equity accounts: Common shares (1,000,000 issued)$1,200,000Retained earnings1,550,000 The company was also authorized to issue an unlimited number
On January 1, 2021,SunlandLtd. had the following shareholders' equity accounts:
Common shares (1,000,000 issued)$1,200,000Retained earnings1,550,000
The company was also authorized to issue an unlimited number of $4 noncumulative preferred shares. As at January 1, 2021, none had been issued. During 2021, the corporation had the following transactions and events related to its shareholders' equity:
Jan.2Issued103,000preferred shares for $51per share.
Apr.1Paid quarterly dividend to preferred shareholders.July1Paid quarterly dividend to preferred shareholders.
Aug.12Issued103,000common shares for $2.00per share.
Oct.1Paid quarterly dividend to preferred shareholders.Dec.31Paid quarterly dividend to preferred shareholders and a $0.25per share dividend to the common shareholders.
Dec.31Loss for the year was $103,000.
Journalize the transactions and the entries to close dividends and the Income Summary account.(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 0 for the amounts. Record journal entries in the order presented in the problem.)
Date
Account Titles and Explanation
Debit
Credit
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
(To record issuance of shares.)
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
(To record issuance of shares.)
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
Dec. 31
(To record dividends paid)
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
(To close Income Summary.)
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
(To close dividends.)
List of Accounts
Open general ledger accounts for the shareholders' equity accounts, enter the beginning balances, and post entries from the previous part.(Post entries in the order of Journal entry presented in the previous part.)
Preferred Shares
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 2
J1
Common Shares
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
Aug. 12
J1
Cash DividendsPreferred
Date
Explanation
Ref.
Debit
Credit
Balance
Apr. 1
J1
July 1
J1
Oct. 1
J1
Dec. 31
J1
Dec. 31
Closing entry
J1
Cash DividendsCommon
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
J1
Dec. 31
Closing entry
J1
Retained Earnings
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
Dec. 31
Closing entry
J1
Dec. 31
Closing entry
J1
List of Accounts
Prepare the shareholders' equity section of the balance sheet at December 31, 2021, including any required disclosures. AssumeSunlandis reporting under ASPE.(Enter account name only and do not provide descriptive information.)
SUNLANDLTD.
Balance Sheet (Partial)
Quarter Ended December 31, 2021
Year Ended December 31, 2021
December 31, 2021
Total Current Liabilities
Share Capital
Shareholders' Equity
Total Shareholders' Equity
Current Liabilities
Total Share Capital
Share Capital
Total Share Capital
Total Current Liabilities
Total Shareholders' Equity
Shareholders' Equity
Current Liabilities
$
Current Liabilities
Share Capital
Total Share Capital
Shareholders' Equity
Total Shareholders' Equity
Total Current Liabilities
Total Share Capital
Total Current Liabilities
Shareholders' Equity
Total Shareholders' Equity
Current Liabilities
Share Capital
$On January 1, 2021,SunlandLtd. had the following shareholders' equity accounts:
Common shares (1,000,000 issued)$1,200,000Retained earnings1,550,000
The company was also authorized to issue an unlimited number of $4 noncumulative preferred shares. As at January 1, 2021, none had been issued. During 2021, the corporation had the following transactions and events related to its shareholders' equity:
Jan.2Issued103,000preferred shares for $51per share.
Apr.1Paid quarterly dividend to preferred shareholders.July1Paid quarterly dividend to preferred shareholders.
Aug.12Issued103,000common shares for $2.00per share.
Oct.1Paid quarterly dividend to preferred shareholders.Dec.31Paid quarterly dividend to preferred shareholders and a $0.25per share dividend to the common shareholders.
Dec.31Loss for the year was $103,000.
Journalize the transactions and the entries to close dividends and the Income Summary account.(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 0 for the amounts. Record journal entries in the order presented in the problem.)
Date
Account Titles and Explanation
Debit
Credit
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
(To record issuance of shares.)
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
(To record issuance of shares.)
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
Dec. 31
(To record dividends paid)
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
(To close Income Summary.)
Jan. 2
Apr. 1
July 1
Aug. 12
Oct. 1
Dec. 31
(To close dividends.)
List of Accounts
Open general ledger accounts for the shareholders' equity accounts, enter the beginning balances, and post entries from the previous part.(Post entries in the order of Journal entry presented in the previous part.)
Preferred Shares
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 2
J1
Common Shares
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
Aug. 12
J1
Cash DividendsPreferred
Date
Explanation
Ref.
Debit
Credit
Balance
Apr. 1
J1
July 1
J1
Oct. 1
J1
Dec. 31
J1
Dec. 31
Closing entry
J1
Cash DividendsCommon
Date
Explanation
Ref.
Debit
Credit
Balance
Dec. 31
J1
Dec. 31
Closing entry
J1
Retained Earnings
Date
Explanation
Ref.
Debit
Credit
Balance
Jan. 1
Balance
Dec. 31
Closing entry
J1
Dec. 31
Closing entry
J1
List of Accounts
Prepare the shareholders' equity section of the balance sheet at December 31, 2021, including any required disclosures. AssumeSunlandis reporting under ASPE.(Enter account name only and do not provide descriptive information.)
SUNLANDLTD.
Balance Sheet (Partial)
Quarter Ended December 31, 2021
Year Ended December 31, 2021
December 31, 2021
Total Current Liabilities
Share Capital
Shareholders' Equity
Total Shareholders' Equity
Current Liabilities
Total Share Capital
Share Capital
Total Share Capital
Total Current Liabilities
Total Shareholders' Equity
Shareholders' Equity
Current Liabilities
$
Current Liabilities
Share Capital
Total Share Capital
Shareholders' Equity
Total Shareholders' Equity
Total Current Liabilities
Total Share Capital
Total Current Liabilities
Shareholders' Equity
Total Shareholders' Equity
Current Liabilities
Share Capital
$
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Accounting Principles
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
13th edition
978-1-119-4110, 1119411483, 9781119411017, 978-1119411482
