Question

Ched Comparative statements of shareholders' equity for Anaconda International Corporation were reported as follows for the fiscal years ending December 31, 2021 2022, and 2023. Retained Earnings 1,750 Total Shareholders' Equity 2,515 1,000 72 ANACONDA INTERNATIONAL CORPORATION Statements of Shareholders' Equity For the Years Ended Dec. 31, 2021, 2022, and 2023 ($ in millions) Preferred Common Additional Stock Stock Paid-In $10 par $1 par Capital Balance at January 1, 2021 85 680 Sale of preferred shares 20 980 Sale of common shares 64 Cash dividend, preferred Cash dividend, common Net income Balance at December 31, 2021 1,724 Retirement of shares (56) Cash dividend, preferred Cash dividend, common 3-for-2 split effected in the form of a dividend (10) Net income Balance at December 31, 2022 1,658 Common stock dividend Cash dividend, preferred Cash dividend, common Net income Balance at December 31, 2023 30 90 695 (2) (19) 290 2,019 (15) (2) (23) (2) (19) 290 3,856 (78) (2) (23) 440 4,193 440 2,419 (41) (2) (25) 482 2,833 (2) (25) 482 4,648 Required: 1. Infer from the statements the events and transactions that affected Anaconda International Corporation's shareholders' equity during 2021, 2022, and 2023. Prepare the journal entries that reflect those events and transactions. (Hint: In lieu of revenues and expenses, use an account titled "Income summary" to close net income or net loss.) 2. Prepare the shareholders' equity section of Anaconda's comparative balance sheets at December 31, 2023 and 2022. Complete this question by entering your answers in the tabs below.

Answer 1

Journal entries

1. Sale of Preferred stock

Cash A/c    Dr                                                                      1000

                To Preferred stock A/C                                                                  20

                To Share premium A/c                                                                   980

(Being preferred stock issued during the year)

2. Sale of common stock

Cash A/c   Dr                                                                       72

                To Common stock A/c                                                                    8

                To Share premium A/c                                                                   64

(Beingcommon stock issued during the year)

3. Dividend paid

Preffered – Dividend A/c Dr                                       2

Common – Divedend A/c Dr                                       19

                To Cash A/c                                                                                        21

(Being dividend paid)

4. Retirement of shares

Common stock A/c Dr                                                   7

Share premium A/c Dr                                                   56

Retained earnings                                                           15

                To Cash A/c                                                                                        78

(being shares redeemed at premium)

5. Dividend paid

Preffered – Dividend A/c Dr                                       2

Common – Divedend A/c Dr                                       23

                To Cash A/c                                                                                        25

(Being dividend paid)

6. Split of stock

Share premium A/c Dr                                                   10

                To Preferred stock A/c                                                                  10

(Being shares split made)

7. Common stock dividend

Dividend A/c Dr                                                                                41

                To Common stock                                                                            4

                To Share premium                                                                           37

Being Dividend issued by way of shares

8. Dividend

Preffered – Dividend A/c Dr                                       2

Common – Divedend A/c Dr                                       25

                To Cash A/c                                                                                        27

(Being dividend paid)

Balancesheet
		at Dec 31 In Millions
		2023	2022
Shareholder's Equity		4,193	3,856
Additional paid in capital
Preferred stock			-
Common Stock		41	-63
retained earnings		414	400
Total Shareholder's Equity		$4,648.00	$4,193.00