Equity Transactions Congo Corp. Has the Following Capital Structure at the Beginning

Essay

Equity transactions
Congo Corp. has the following capital structure at the beginning of this year: Instructions
a) Record the following transactions which occurred consecutively this year. Show all calculations.
i. There are no dividends in arrears. A total cash dividend of $ 90,000 was declared. The preferred shares are participating to a maximum of 10%. Record dividends payable to common and preferred shares in separate accounts.
ii. A 10% common stock dividend was declared. The current market value of the common shares is $ 16 a share.
iii. Net income for the year was $ 180,000. Record the closing entry.
b) Incorporating all the above information, construct the shareholders' equity.