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Wilma Corporation reported the following amounts in its shareholders equity section on the December 31, 2014 balance sheet: Preferred shares, $5 dividend, 10,000 shares authorized,

Wilma Corporation reported the following amounts in its shareholders equity section on the December 31, 2014 balance sheet:

Preferred shares, $5 dividend, 10,000 shares authorized,

2,500 shares issued

$180,000

Common shares, 100,000 authorized, 25,000 issued

100,000

Contributed Surplus'

122,000

Retained Earnings

238,000

Total Shareholders Equity

$640000

During 2015, the following transactions impacted shareholders equity:

  1. Jan 15: Purchased 6000 shares of its own common shares for $26 per share and retired them

  1. Feb 1: Issued 1,500 preferred shares at $81 per share

  1. Nov 1: Declared a 10% stock dividend on the outstanding common shares when they were trading at $31 per share.

  1. Dec 31: Declared the annual 2015, $5 per share preferred share dividend and a $3 per share dividend on the common shares. These dividends are payabIe in 2016.

Required:

  1. Prepare journal entries for each of the transactions in 2015 (11 marks)

  1. Assume 2015 net income was $310,000, what is the ending balance of Retained Earnings for year ended December 31, 2015? (4 marks)

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