The Following Is an Extract from the Balance Sheet as at December

question 11

Essay

The following is an extract from the balance sheet as at December 31,1011:
The company did not declare dividends on preferred shares in 2011.Transactions in 2012 include the following:
i.March 15: Hewitt purchased 15,000 preferred shares on the stock exchange for $15.25 per share and held these in treasury.
ii.March 28: The company redeemed 5,000 preferred shares directly from shareholders.
iii.July 1: The market price of common shares shot up to $5 per share,so Hewitt decided to split the common shares two to one.
iv.August 1: Hewitt cancelled 14,000 preferred shares that were held in treasury.
v.December 31: The company declared dividends of $0.50 per common share.
Requirement:
Prepare the journal entries to record the above transactions.The company uses the single-transaction method to account for treasury shares.

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Definitions:

Lobby

The act of attempting to influence the decisions of government officials, often by groups or individuals with specific agendas.

Direct Liability Doctrine

A principle that holds an individual or entity directly responsible for their actions or omissions that cause harm or damage, without needing to rely on the actions of another party.

Vicarious Liability

Legal responsibility assigned to one party for the actions of another, typically seen in employment where the employer is liable for employees' acts.

Vehicular Homicide

A legal charge for causing the death of a person due to illegal driving of an automobile, including driving under the influence.