At the end of 2019, Stanley Utilities Inc. had the following equity accounts and balances: Common stock,

Question:

At the end of 2019, Stanley Utilities Inc. had the following equity accounts and balances:

Common stock, $1 par ....................................... $4,500,000

Additional paid-in capital-common stock ................. 1,375,000

Retained earnings ................................................ 188,000

During 2020, Stanley Utilities engaged in the following transactions involving its equity accounts:

a. Sold 3,300 shares of common stock for $15 per share.

b. Sold 1,000 shares of 12%, $100 par preferred stock at $105 per share.

c. Declared and paid cash dividends of $8,000.

d. Repurchased 1,000 shares of treasury stock (common) for $38 per share.

e. Sold 400 of the treasury shares for $42 per share.

Required

1. Prepare the journal entries for Transactions a through e.

2. Assume that 2020 net income was $87,000. Prepare a statement of stockholders' equity at December 31, 2020?

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...