Smart Touch Ltd has the following shareholders' equity at 30 June 2020.
Preference capital, 50c per share annual dividend, 20 000 shares issued = $220,000
Ordinary Capital, 40 000 shares issued = 2200000
Total share capital = 2420000
Retained earnings = 190000
Total shareholders' equity = 2610000
Assuming the following transactions occurred from 1 July 2020 to 30 June 2021. Smart Touch accounting year ends on 30 June. The preference shares are non-cumulative.
(1) Sales on account were $80 000; 3% of sales were estimated to be uncollectable, and estimated warranty expense was 4% of sales. The cost of sales was $50 000.
(2) Issued 1,000 ordinary shares to acquire inventory valued at $1000 and equipment with market value of $ 19800. The cost of the equipment was $ 40000 and accumulated depreciation was $ 28000.
(3) Paid preference shareholders dividend.
(4) Recorded depreciation expenses of $8200
1. The balance of ordinary shares at 30 Jnue 2021 is :
2. The balance of retained earnings at 30 June 2021 is: