The following transactions are for Jenolan Ltd.

1. Profit for the year was $3 500000. Ignore income tax.

2. Directors resolved to transfer the amounts specified below from retained earnings to:

• contingencies reserve, $2000000
• general reserve, $800000.

3. Some years ago, the company had established an exchange fluctuation reserve, $9 000000, but now that it had withdrawn from international trade, this reserve was no longer required.

4. Startup costs of $500000 were to be written off. This has not been reflected in the profit in (1) above.

5. An interim dividend of $400000 had been paid and directors recommended a final dividend of $600000 to be paid in 3 months time, after ratification by shareholders at the annual general meeting. Both dividends were paid out of retained earnings.

Note: The beginning balance of the Retained Earnings account was $3 600000.

Required

(a) Show the journal entries to record transactions 1 to 5.

(b) Prepare the statement of changes in equity for Jenolan Ltd.