Sloboda Corporation was organized in 2013 At December

31 2013 #8338
Sloboda Corporation was organized in 2013. At December 31, 2013, Sloboda Corporation's
balance sheet reported the following shareholders' equity:Preferred shares, $0.20, 50,000
shares authorized, none issued....................$ 0Common shares, 100,000 shares authorized,
10,000 shares issuedand
outstanding......................................................................87,500Retained earnings
(Deficit).......................................................(20,000)Total shareholders'
equity.........................................................$67,500Required1. What does the $0.20 mean for the
preferred shares? If Sloboda Corporation issued 4,000 preferred shares, how much in cash
dividends will Sloboda Corporation expect to pay per year?2. At what average price per share
did Sloboda Corporation issue the common shares?3. Were first-year operations profitable?
Give your reason.4. During 2014, the company completed the following selected transactions.
Journalize each transaction. Explanations are not required.a. Issued for cash 10,000 preferred
shares at $2.50 per share.b. Issued for cash 1,000 common shares at a price of $9.00 per
share.c. Issued 25,000 common shares to acquire a building valued at $235,000.d. Net income
for the year was $62,500, and the company declared no dividends. Make the closing entry for
net income.5. Prepare the shareholders' equity section of the Sloboda Corporation balance
sheet at December 31, 2014.View Solution:
Sloboda Corporation was organized in 2013 At December 31 2013

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