QUESTION 1

Presented below are the accounts and related balances for ECOM Finance Ltd, at September 30, 2020.

Salary Payables	$3000
Cash	15000
Accounts Payable	20000
Retained Earnings	80000
Organization Costs, net	1000
Long-term Notes Payable	70000
Common Shares, 60,000 shares authorized, 25,000 shares issued	95000
Inventory	85000
Property, Plant and Equipment, net	204,000
Accounts Receivable, net	25000
Income Tax Payable	12000
Preferred Shares, $6.00, cumulative, 20000 shares authorized, 3000 shares issued	50000

Required:

1. Prepared the classified balance sheet at September 30, 2020. Use the account format for the balance sheet.

(see next page)

2. Are the preferred shares cumulative or noncumulative?

Answer: ______________________________________________________

3. What is the total amount of the annual preferred dividend? Answer: ________________________________________________________
4. Assume the common shares were all issued at the same time. What was the selling price per share? Answer: ________________________________________________________
5. Compute the book value per share of the preferred shares and the common shares. No prior-year preferred dividends are in arrears, and ECOM Finance Ltd. has not declared the current-year dividend