Problem 7 Corporations 30 minutes 25 marks

Slytherin Inc. is a new company and is authorized to issue unlimited, $15, non-cumulative preferred shares and an unlimited number of common shares. The following transactions affecting the equity of the company occurred during 2020.

January 6	Issued 30,000 common shares at $14 per share
January 12	Issued 12,000 preferred shares at $51 per share.
June 30	Slytherin Inc. declares a cash dividend on both preferred and common shares totalling $290,000 for the shareholders of record July 10. The dividend will be paid on July 15th.
July 15	Slytherin Inc. paid the cash dividend declared on June 30th.
December 31	After all the revenue and expense accounts were closed, the income summary showed a profit of $670,000.

Required:

1. Prepare the journal to record the above transactions. Make sure to include the closing of the income summary and cash dividend account on Dec 31st.

2. Prepare the statement of shareholders equity in the template provided as of Dec 31^st, 2020.