Pant A: 2020 PetWear Corporation sells pet clothes to pet stores in Ontario. The company has the following equity at January 1, 2020 : F (1 C F During 2020 the following transactions occurred (ignore income taxes for purposes of these transactions): 1. Sold 20,000 common shares on February 1 for $5.50 each. 2. On August 1 purchased land for a factory site by issuing 10,000 preferred shares. The preferred shares are selling at $26 each and the value of the land is $280,000 according to the local real-estate agent. 3. Paid the annual preferred share dividend on November 30 to shareholders of record on November 15 . The dividend was declared on November 1. 4. Profit at the end of the year is $298,000. Required: a) Record all of the transactions for 2020. b) Provide the statement of changes in equity for 2020 . c) Provide the equity section of the statement of financial position for 2020 . d) Calculate the earnings per share for 2020 . e) Explain to the president, Mithuna Rajamithiran, the economic difference between buying an asset such as land for cash vs. buying it by issuing shares. Is it "better" to acquire a new asset without having to give up another asset such as cash? f) Mithuna is considering not paying the preferred dividend in 2021 so that the company has extra cash to reinvest in the business. She tells you that the benefit of equity financing is that there is no requirement to pay dividends on either preferred or common shares. Do you agree with Mithuna? Explain why or why not and any possible impact of not paying the dividend in 2021 . During 2021 PetWear Corporation had the following equity transactions (ignore income taxes for purposes of these transactions): 1. In late February the company's share price dropped dramatically. On March 1, the company repurchased 5,000 common shares with cash. The shares were purchased for $3.90 each. The shares were cancelled. 2. On April 1 issued 300 preferred shares to Benjamin Cain for legal services rendered in connection with a lawsuit. The shares are presently selling for $25 each and the invoice for the legal services shows a balance outstanding of $8,000. 3. On August 1 repurchased 6,000 more common shares with cash. The shares were now selling on the market for $5.25 each. The shares were repurchased in order to fulfill stock options from employees. 4. Paid the annual preferred share dividend on November 30 to shareholders of record on November 15 . The dividend was declared on November 1. 5. Declared a 5% stock dividend to common shareholders on December 1 to shareholders of record on December 8 . Issued the shares on December 20,2021 . Common shares were valued as follows on those dates: $5.80,$5.92,$6.21 respectively. 6. Profit for 2021 was $226,000 (not including legal fees in \#2). Required: a) Record all of the transactions for 2021. b) Provide the statement of changes in equity for 2021 . c) Provide the equity section of the statement of financial position for 2021 . d) The president of the company, Mithuna Rajamithiran, would like to better understand the impact on the financial statements, particularly the equity section of the statement of financial position, with regards to a cash dividend, stock dividend, and stock split. She would also like to better understand the reason why a company would want to split their stock. Pant A: 2020 PetWear Corporation sells pet clothes to pet stores in Ontario. The company has the following equity at January 1, 2020 : F (1 C F During 2020 the following transactions occurred (ignore income taxes for purposes of these transactions): 1. Sold 20,000 common shares on February 1 for $5.50 each. 2. On August 1 purchased land for a factory site by issuing 10,000 preferred shares. The preferred shares are selling at $26 each and the value of the land is $280,000 according to the local real-estate agent. 3. Paid the annual preferred share dividend on November 30 to shareholders of record on November 15 . The dividend was declared on November 1. 4. Profit at the end of the year is $298,000. Required: a) Record all of the transactions for 2020. b) Provide the statement of changes in equity for 2020 . c) Provide the equity section of the statement of financial position for 2020 . d) Calculate the earnings per share for 2020 . e) Explain to the president, Mithuna Rajamithiran, the economic difference between buying an asset such as land for cash vs. buying it by issuing shares. Is it "better" to acquire a new asset without having to give up another asset such as cash? f) Mithuna is considering not paying the preferred dividend in 2021 so that the company has extra cash to reinvest in the business. She tells you that the benefit of equity financing is that there is no requirement to pay dividends on either preferred or common shares. Do you agree with Mithuna? Explain why or why not and any possible impact of not paying the dividend in 2021 . During 2021 PetWear Corporation had the following equity transactions (ignore income taxes for purposes of these transactions): 1. In late February the company's share price dropped dramatically. On March 1, the company repurchased 5,000 common shares with cash. The shares were purchased for $3.90 each. The shares were cancelled. 2. On April 1 issued 300 preferred shares to Benjamin Cain for legal services rendered in connection with a lawsuit. The shares are presently selling for $25 each and the invoice for the legal services shows a balance outstanding of $8,000. 3. On August 1 repurchased 6,000 more common shares with cash. The shares were now selling on the market for $5.25 each. The shares were repurchased in order to fulfill stock options from employees. 4. Paid the annual preferred share dividend on November 30 to shareholders of record on November 15 . The dividend was declared on November 1. 5. Declared a 5% stock dividend to common shareholders on December 1 to shareholders of record on December 8 . Issued the shares on December 20,2021 . Common shares were valued as follows on those dates: $5.80,$5.92,$6.21 respectively. 6. Profit for 2021 was $226,000 (not including legal fees in \#2). Required: a) Record all of the transactions for 2021. b) Provide the statement of changes in equity for 2021 . c) Provide the equity section of the statement of financial position for 2021 . d) The president of the company, Mithuna Rajamithiran, would like to better understand the impact on the financial statements, particularly the equity section of the statement of financial position, with regards to a cash dividend, stock dividend, and stock split. She would also like to better understand the reason why a company would want to split their stock