QUESTION 1 (25 Marks) Rindiana Bhd. is a lighting fixture wholesaler located in Tanjung Malim, Perak. During its current fiscal year, ended December 31, 2021, Rindiana Bhd. completed the following selected transactions: Date Details Feb 3 May 1 June 15 Sept 23 Nov 1 Dec 1 Rindiana Bhd. purchased 2,500 shares of its own common stock at RM26.00, recording the stock at cost. (Prior to the purchase, there were 40,000 shares of RM20.00 par common stock outstanding) Rindiana Bhd declared a semi-annual dividend of RM1.00 on the 10,000 shares of preferred stock and a 30 cents dividend on the common stock to stockholders of record on May 31, payable on June 15. Paid the cash dividends Sold 1,000 shares of treasury stock at RM28.00, receiving cash. Declared semi-annual dividends of RM1.00 on the preferred stock and 30 cents on the common stock. In addition, a 5% common stock dividend was declared on the common stock outstanding, to be capitalized at the fair market value of the common stock, which is estimated at RM30.00 Paid the cash dividends and issued the certificates for the common stock dividend REQUIRED: a. Journalize the entries to record the transactions for Rindiana Bhd. [18 Marks] b. Explain how a company finances its business with equity? [2 Marks] c. Define retained earnings and account for its increases and decreases. [2 Marks] d. An entity has 10,000 shares of 8% cumulative preferred stock and 20,000 shares of common stock outstanding. Par value for each is RM100.00. No dividends were paid last year, but this year RM200,000.00 in dividends is paid to stockholders. How much of this RM200,000.00 goes to the holders of preferred stock? [3 Marks]