The following is West Valley Company s stockholders equity section of the balance sheet on December 31, 2002:
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Preferred stock (8%, $60 par, noncumulative, 16,000 shares authorized,
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8,000 shares issued and outstanding)
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$480,000
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Common stock ($10 par, 120,000 shares authorized,
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80,000 shares issued and outstanding)
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800,000
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Paid-in capital in excess of par, preferred stock
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130,000
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Paid-in capital in excess of par, common stock
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252,000
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Retained earnings.
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330,000
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Required
1. Journalize the following 2003 transactions:
a. Issued 2,000 preferred shares at $70 per share.
b. Reacquired 1,000 common shares for the treasury at $13 per share.
c. Declared and paid a $2-per-share dividend on common stock in addition to paying the required preferred dividends. (Note: Debit Retained Earnings directly.)
d. Reissued 600 treasury shares at $14 per share.
e. Reissued the remaining treasury shares at $12 per share.
f. Earnings for the year were $92,000, including $200,000 of revenues and $108,000 of expenses.
2. Prepare the stockholders equity section of the balance sheet for the company at December 31, 2003.