You are provided with the following information from the equity section of Aurora Ltd.’s balance sheet on December 31, 2014:

During the year ended December 31, 2015 the following occurred (events are recorded in the order they occurred during the year):
i. Semi-annual dividend on common shares of \($0.25\) per share was declared and paid.
ii. 1,000,000 commons shares were issued for $8,000,000.
iii. 50,000 shares of preferred shares were issued for $250,000.
iv. 10,000 common shares were issued in exchange for new equipment. The equipment had a list price on the vendor’s price list of $92,000.
v. Preferred dividends of \($2\) per share were declared and paid.
vi. 10 percent stock dividend was declared on the outstanding common shares.
vii. Semi-annual dividend on common shares of \($0.25\) was declared. The dividend will be paid in January 2016.
viii. Net income was $5,250,000.

Required:

a. Prepare the journal entries required to record the above events.

b. Prepare the shareholders’ equity section of Aurora balance sheet on December 31, 2015.

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Preferred shares-authorized, 1,000,000 shares; outstanding 700,000 shares Common shares-authorized, unlimited; outstanding 6,000,000 shares Retained earnings $ 3,500,000 18,000,000 11,500,000