The stockholders' equity accounts of Sheffield Corp. on January 1, 2025, were as follows.

• Preferred Stock (7%, $100 par noncumulative, 4,000 shares authorized) $240,000
• Common Stock ($4 stated value, 240,000 shares authorized) 800,000
• Paid-in Capital in Excess of Par-Preferred Stock 12,000
• Paid in Capital in Excess of Stated Value-Common Stock 384,000
• Retained Earnings 550,400
• Treasury Stock (4,000 common shares) 32,000

During 2025, the corporation had the following transactions and events pertaining to its stockholders' equity.

• Feb. 1 Issued 4,000 shares of common stock for $24,000.
• Mar. 20 Purchased 800 additional shares of common treasury stock at $7 per share.
• Oct. 1 Declared a 7% cash dividend on preferred stock, payable November 1.
• Nov. 1 Paid the dividend declared on October 1.
• Dec. 1 Declared a $0.50 per share cash dividend to common stockholders of record on December 15 , payable
• Dec. 31 Determined that net income for the year was $225,000. Paid the dividend declared on December 1 .

I completed the first step of (a) Journalize the transactions. (Include entries to close net income and dividends to Retained Earnings.)

This is where I am stuck:

(b) Enter the beginning balances in the accounts and post the journal entries to the stockholders' equity accounts.

(c) Prepare the stockholders' equity section of the balance sheet at December 31,2025 . (Enter account name only and do not provide descriptive information.)

(d) Calculate the payout ratio, earnings per share, and return on common stockholders' equity. (Note: Use the common shares outstanding on January 1 and December 31 to determine the average shares outstanding.) (Round answers to 2 decimal places for per unit and percentage, e.g. 17.50 or 17.50%.)

Answer rating: 100% (QA)

b To enter the beginning balances in the accounts and post the journal entries to the stockholders equity accounts we need to consider the transactions and events that occurred during the year 2025 Le... View the full answer