Problem 1 The shareholders' equity section of Trane Inc. as at December 31, 20x6 is as follows: Common shares, 3,500,000 shares outstanding Contributed surplus - Common Share Repurchases Retained Earnings $24,000,000 280,000 7,900,000 The following transactions took place during 20x7: Jan 2 Employees subscribed for 40,000 shares at $11 per share. A deposit of 10% was received on this date. Jan 26 Issued 300,000 shares for total cash proceeds of $3,600,000. Mar 31 Employees holding 38,000 share subscriptions submitted their 30% deposit on the share subscription plan. The 2,000 shares subscribed were cancelled due to employees leaving the company. Their deposits on the share subscription plan was refunded. Apr 15 Repurchased 50,000 common shares for $15 per share. May 31 The board of directors approved a 2:1 stock split. Jun 30 Issued 200,000 shares for total cash proceeds of $1,600,000. Oct 31 Employees holding 37,000 share subscriptions submitted their second 30% deposit on the share subscription plan. The 1,000 shares subscribed were cancelled due to employees leaving the company. Their deposits on the share subscription plan was refunded. Nov 12 Repurchased 80,000 common shares for $11 per share. Dec 15 Employees holding 35,500 share subscriptions submitted their final deposit on the share subscription plan. The 1,500 shares subscribed were cancelled due to employees leaving the company. Their deposits on the share subscription plan was refunded. A total of 71,000 common shares were issued on this date. Dec 18 The board of directors authorized a $0.25 common share dividend to shareholders of record on December 31, The dividend is payable January 15, 20x8. Required a. Prepare all journal entries to record the above. Use 4 decimals when calculating per share book values. Prepare a Statement of changes in shareholders' equity for the year ended December 31, 20x7. The net income for the year was $2,300,000. b. Problem 1 The shareholders' equity section of Trane Inc. as at December 31, 20x6 is as follows: Common shares, 3,500,000 shares outstanding Contributed surplus - Common Share Repurchases Retained Earnings $24,000,000 280,000 7,900,000 The following transactions took place during 20x7: Jan 2 Employees subscribed for 40,000 shares at $11 per share. A deposit of 10% was received on this date. Jan 26 Issued 300,000 shares for total cash proceeds of $3,600,000. Mar 31 Employees holding 38,000 share subscriptions submitted their 30% deposit on the share subscription plan. The 2,000 shares subscribed were cancelled due to employees leaving the company. Their deposits on the share subscription plan was refunded. Apr 15 Repurchased 50,000 common shares for $15 per share. May 31 The board of directors approved a 2:1 stock split. Jun 30 Issued 200,000 shares for total cash proceeds of $1,600,000. Oct 31 Employees holding 37,000 share subscriptions submitted their second 30% deposit on the share subscription plan. The 1,000 shares subscribed were cancelled due to employees leaving the company. Their deposits on the share subscription plan was refunded. Nov 12 Repurchased 80,000 common shares for $11 per share. Dec 15 Employees holding 35,500 share subscriptions submitted their final deposit on the share subscription plan. The 1,500 shares subscribed were cancelled due to employees leaving the company. Their deposits on the share subscription plan was refunded. A total of 71,000 common shares were issued on this date. Dec 18 The board of directors authorized a $0.25 common share dividend to shareholders of record on December 31, The dividend is payable January 15, 20x8. Required a. Prepare all journal entries to record the above. Use 4 decimals when calculating per share book values. Prepare a Statement of changes in shareholders' equity for the year ended December 31, 20x7. The net income for the year was $2,300,000. b
