Question

1.

Blue Spruce Limited reported profit of $436,010 for its November 30, 2021, year end. Cash dividends of $64,200 on the common shares and $69,500 on the noncumulative preferred shares were declared and paid during the year. The following information is available regarding Blue Spruce's common shares:

Dec. 1, 2020		The opening number of common shares was 54,200.
Feb. 28, 2021		Sold 9,200 common shares for $165,600 cash.
May 31, 2021		Reacquired 4,600 common shares for $73,600 cash.
Nov. 1, 2021		Issued 13,800 common shares in exchange for land with a fair value of $370,00

Calculate the profit available to common shareholders.

enter the Profit available to common shareholders in dollars

2. On July 9, 2021, Sandhill Enterprises Inc. discovered it had recorded the $72,000 purchase of land as legal expense on November 8, 2020. The company had reported retained earnings of $550,500 at its previous year end, December 31, 2020.

During 2021, Sandhill had profit of $185,000 and it declared and paid cash dividends of $207,000. Sandhill has a 25% income tax rate.

(a)

Prepare the journal entry to correct the error. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

	select an account title to record correction of error on January 1                                                                      CashIncome Tax PayableLandIncome Tax ExpenseRetained Earnings	enter a debit amount	enter a credit amount
	select an account title to record correction of error on January 1                                                                      Income Tax ExpenseRetained EarningsLandCashIncome Tax Payable	enter a debit amount	enter a credit amount
	select an account title to record correction of error on January 1                                                                      LandRetained EarningsCashIncome Tax PayableIncome Tax Expense	enter a debit amount	enter a credit amount

Answer 1

A The Pro tit available to Common shne holder is calculated bels w 436,010 Net profit less oividend paid to non cumulative 69,5o. The protit availabk to common sharehoky 366, 510 in'pollar The proht ayailable to common shacholdes in Do'llar is $366,510 OCorrected joysnal entry is a A Clount tollouws Leate July9 Land |Credit ($) Debit 3) 72000 TO Legal eapenses KReing punchase of Lond is urangly debitid tolegal eapenser noud corected 2021 72000