Dana Company reported the following amounts in the stockholders’ equity section of its December 31, 2006 balance sheet:

Preferred stock, 9%, $100 par (10,000 shares authorized, 1,000 shares issued) . $100,000

Common stock, $10 par (20,000 shares authorized, 9,000 shares issued) ..... 90,000

Additional paid-in capital on preferred stock ............... 20,000

Additional paid-in capital on common stock ............... 99,000

Retained earnings ......................... 330,000

During 2007, the company’s net income was $83,000 and its dividends on preferred and common stock were $9,900 and $17,600, respectively. In addition, the following transactions affected its stockholders’ equity:

1. Purchased 750 shares of its outstanding common stock as treasury stock for $22 per share.

2. Sold 500 shares of treasury stock at $27 per share. The company uses the cost method to account for treasury stock.

3. Retired 200 of the common shares held in the treasury.

4. Issued 100 shares of preferred stock for $125 per share.

5. The aggregate market value of the company’s long-term investments in available-for-sale equity securities dropped below the carrying value of these securities at year-end. The difference between the carrying value and the year-end market value totals $10,000 (net of taxes).

Required

1. Prepare Dana Company’s statement of changes in stockholders’ equity for 2007. Assume Dana Company reports its comprehensive income in this statement.

2. Prepare the stockholders’ equity section of Dana Company’s balance sheet as of December 31, 2007. Include any related notes to its financial statements.