Shelby was organized in January 2017 by ten shareholders to operate an air-conditioning sales and service business. The charter issued by the province authorized the following shares:
Common shares: no-par value; 200,000 shares
Preferred shares: no-par value; 6 percent; 50,000 shares
During January and February 2017, the following share transactions were completed:
a. Collected $40,000 cash from each of the ten organizers and issued 2,000 common shares to each of them
b. Issued 15,000 preferred shares at $25 per share; collected in cash Net income for 2017 was $40,000; cash dividends declared and paid at year-end were $10,000.
Required:
Prepare the shareholders’ equity section of the at December 31, 2017.
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