On January 15, 2020, you are looking for OZ with Scarecrow, walking along the yellow brick road singing "If I only had a brain". After you have sung this song 5 times you decide that something else needs to fill your time or your brain will be as active as Scarecrow's. You ask Scarecrow how his father's company, Crows Be Gone Ltd, is doing. Scarecrow replies "It is doing well but my father is looking for someone to help him prepare his reports, I think he called them financial statements". You smile as you realize that now know how you are going to pass the time on the way to OZ. "I can help your father with his financial statements" you reply. Scarecrow starts rambling and you being taking furious notes on your iPad to try and make sure you get all the information. "So my father needs to make a Balance Sheet, I remember the name because I was balancing on one foot at the time. He has listed all his assets and liabilities but they don't balance. I think there is another item we are missing, and a Statement of Changes in Shareholder's Equity is needed to figure out the amounts. I was listening to him talk to my mother when he started Crows Be Gone Ltd (CBGL) and it sounded like he was talking crazy. He was talking about preferred shares and common shares, I don't know what those are. He mentioned the word cumulative in his discussion which is such a big word don't you think? There was a dividend attached to the preferred shares of $3, and I couldn't figure out how they attached coins to a share, does it have a pocket? My mother then sounded very official and was mentioning authorization, she said there were 100,000 authorized preferred shares and unlimited authorized common shares, no idea what she was talking about but I wish my allowance was unlimited. It also sounded like good news when they mentioned that 2019 net income was $650,000. He also mentioned that his company was public and followed "IFRS". I don't understand what that means since I thought he didn't think he sold the scarecrows to the public. I am always confused!" "At the beginning of this year, I remember I was playing Fortnite in my dad's office and he came in with his accountant and they started talking about numbers and dollar amounts I couldn't make sense of. They were talking about opening balances for the year and they said CBGL had 4,000 preferred shares outstanding worth $250,000. They also said they had 1,800,000 common shares outstanding worth $2,250,000. They said the retained earnings were at $1,500,000 and accumulated other comprehensive income was $30,000. They mentioned a strange account called contributed surplus for repurchase of preferred shares of $5,000. I wonder who gave the company that money? "They also said something about dividends in tears which confused me, oh wait no it was dividends in arrears and as of January 1, 2019, they hadn't paid dividends in two years." "Before you and I left for Oz I found this piece of paper on the floor of my dad's office which I meant to give to my dad but I got distracted and put it in my pocket instead. It has a bunch of dates and transactions on it, but I don't know what it means" (See Exhibit A) Scarecrow hands the paper to you and it is a list of all the shareholder equity transactions for the year. You smile and say to Scarecrow: "I can prepare the Statement of Shareholder's Equity for Crow's Be Gone Ltd, I can also prepare the journal entries for each transaction since I think we're going to be travelling down this yellow brick road for a while." Scarecrow gives you a big hug and says: "I have no idea what you are talking about but I know my dad will be happy. Oh if I only had a brain!" You groan inwardly as you realize that as you do this work for Scarecrow you will have the song "If I only had a brain" playing over and over in your head! Required: 1) Prepare the journal entries to record the transactions listed in Exhibit A for the year ended December 31, 2019. Prepare your solution in the tab called "Ch 13 assignment response." 2) Using the table provided for you in the response tab, prepare a Statement of Changes in Shareholder's Equity for Crow's Be Gone Ltd. Ensure you show your calculations clearly (how you arrived at $ amounts and number of shares). Prepare your solution in the tab called "Ch 13 assignment response" below your response to Required 1. Exhibit A Capital Transaction for Crow's Be Gone Ltd for the year 2019. March 31 The Board of Directors declared a cash dividend of $225,000 to the shareholders of CBGL. The dividend is to include the annual 2019 cash dividend to the preferred shareholders. The date of record is April 15th, and the dividends are to be paid on April 30th. CBGL uses separate dividend payable accounts for each type of dividend. April 1 The Board of Directors issued 200,000 shares in exchange for new custom straw chopping equipment. This equipment is one-of-a-kind, with a estimated fair value between $800,000 and $1,500,000. At this date the shares of CBGL had a market value of $1.50 per share. June 1 CBGL redeems 2,000 preferred shares for $70 per share. June 15 The Board of Directors issued a 2 for 1 stock split on common shares. July 1 The Board of Directors approved and distributed a 10% common stock dividend. The dividend was valued at the average price paid for the common shares to date. September 1 The Board of Directors issued 100,000 shares in exchange for new straw sorting equipment. The equipment had a fair value of $400,000 and at this date the shares of CBGL had a market value of $2.00 per share