Sanford Medical LAM AND TAN Division of Loss Worksheet See the attached questions. Answers available in chegg and course heroPut it in excel Busi 2222 Handout Assignment ch 13
Due: February 12, 2020
Chapter 13 Handout Assignment
During its first year of operations, Millwoods Enterprises Inc. had the following transactions related to
its common shares:
Jan 5 Issued 5,000 common shares to Michelle Vogel for $ 1 each.
Mar 15 Issued 10,000 common shares in exchange for equipment transferred from Vogel. The
equipment was valued at $ 40,000.
Apr 10 Issued 3,500 shares to a consulting firm for management consulting services as settlement
of a $ 14,000 invoice.
Sep 30 Issued 4,000 common shares to Renee Vogel for $ 5 each.
a) Journalize the share transactions.
b) Calculate the average cost of the common shares of Millwoods Enterprises Inc. at December 31.
Bancroft Holdings Inc. has authorized share capital of an unlimited number of common shares and
1,000,000 preferred, $ 3-cumulative preferred shares. At January 1, 2021, the balances in its share
capital accounts were $ 45,000 in common shares representing 15,000 shares and $ 30,000 in
preferred shares representing 1,000 shares. The retained earnings balance on that date was $ 180,000.
Profit for the year ending December 31, 2021 was $ 24,000. There were no dividends in arrears at
January 1, 2021 and no dividends were declared during 2021.
During 2021, Bancroft had the following share transactions:
Issued 4,000 common shares for $ 5 each.
Issued 500 preferred shares for $ 11 each.
Issued 60,000 common shares in exchange for land valued at $ 285,000.
a) Journalize the share transactions.
b) Prepare the equity section of Bancrofts balance sheet at December 31, 2021 and describe any
disclosure requirements related to share capital.
c) Calculate return on equity for 2021.
Busi 2222 Handout Assignment ch 14
Chapter 14 Handout Assignment
Mana Inc. had the following balances in its shareholders’ equity at the beginning of the current year
(January 1, 2021):
Preferred shares ($ 1.50, cumulative*, 100,000
shares authorized, 5,000 shares issued) …………………………………………….
Common shares unlimited shares authorized, 8,000 shares issued …………….
Total shareholders’ equity ………………………………………………………………………
*two years of dividends are in arrears.
During the year ended December 31, 2021, the following transactions took place:
1. On January 1, issued 9,000 common shares at $ 18 per share.
2. On July 1, declared a 10% stock dividend on the common shares, market price $ 18.50 per share.
The dividend is to be paid on August 15 to shareholders of record on July 31.
3. On August 15, the company paid the stock dividend.
4. On September 15, Ryders board of directors declared a 4-for-1 stock split.
During the year, the company had a profit of $ 85,000.
a) Prepare the journal entries to record the above transactions. Closing entries are not required.
b) Prepare a statement of changes in shareholders equity for 2021.
c) Prepare the shareholders equity section of the balance sheet at December 31, 2021.
Record stock dividends,
splits, and reacquisition of
shares. Show impact of
transactions on accounts.
(LO 1, 2) AP
P14-4B The following shareholders’ equity accounts are reported by Talty Inc. on January 1:
Common shares (unlimited authorized, 500,000 issued)
Preferred shares ($9 noncumulative, convertible, 100,000 authorized, 4,000 issued) 600,000
Contributed surplus-reacquisition of common shares
The following selected transactions occurred during the year:
Jan. 17 Issued 50,000 common shares at $10 per share.
Feb. 27 Reacquired 20,000 common shares at $12 per share.
Split the common shares 2 for 1 when the common shares were trading at $20 per share.
Reacquired 500 preferred shares at $145 per share.
Reacquired 100,000 common shares for $11 per share.
Oct. 17 Declared a 5% common stock dividend distributable on December 3 to shareholders of record on
November 14. On October 17, the fair value of the common shares was $10.
Dec. 3 Distributed the stock dividend declared on October 17. On December 3, the fair value of the common
shares was $12.50.
(a) Prepare journal entries for the transactions.
(b) Show how each class of shares will be presented in the shareholders’ equity section of the balance sheet at
TAKING IT FURTHER Provide possible reasons why Talty split the common shares and issued a stock dividend.
Prepare financial statements.
(LO 3, 5) AP
P13-10B Carlotta’s Cakes Inc. is a private company reporting under ASPE. It is authorized to issue an unlimited
number of common and $3 cumulative preferred shares. The following is an alphabetical list of its adjusted
accounts at May 31, 2017, its fiscal year end. All accounts have normal balances.
$ 38,500 Income tax expense
Accumulated depreciation-equipment 126,000 Interest expense
50,000 Notes payable
7,500 Preferred shares
Cost of goods sold
277,475 Retained earnings 73,000
42,000 Salaries expense
420,000 Supplies expense
The note payable is due in 2019. There are 10,000 common shares issued and 5,000 preferred shares issued as
at May 31, 2017
Prepare an income statement, statement of retained earnings, and balance sheet.
TAKING IT FURTHER What ethical issues may managers face when reporting a company’s financial performance?
P12-4B Terry Lam and Chris Tan have a partnership agreement with the following provisions for sharing profit Calculate division of pro
or loss. Prepare statemer
1. A salary allowance of $20,000 to Lam and $30,000 to Tan
partners’ equity and clos
entries. (LO 3, 4) AP
2. An interest allowance of 5% on capital balances at the beginning of the year
3. The remainder to be divided between Lam and Tan on a 3:4 basis
The capital balances on February 1, 2016, for T. Lam and C. Tan were $100,000 and $120,000, respectively. For
the year ended January 31, 2017, the partnership reported a loss of $30,000. The partnership also reported the
following: T. Lam drawings of $12,000 and C. Tan drawings of $14,400.
(a) Prepare a schedule to show how the profit or loss is allocated to the two partners.
(b) Prepare a statement of partners’ equity for the year.
(c) Prepare closing entries on January 31, 2017 to allocate the partnership profit and to close the drawings accounts.
TAKING IT FURTHER In general, what is the relationship between the salary allowance specified in the profit
and loss ratio and a partner’s drawings?
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