Toofles Company, a publicly traded entity, issued nonredeemable preferred stock on January 1, 2022, Toofles issued 1,000 shares of $100 par value shares for $82,425. On January 1, 2022, the market rate of interest for preferred stock with the same characteristics was 6%. The preferred shares will not pay any dividends in 2022 or 2023. In 2024, they will pay 1% of par. In 2018, they will pay 3% of par. In 2026 and thereafter, the shares will pay 6% of par. 

Management would like to know how to account for these shares both at issuance and thereafter. Prepare a memo to the file using the Codification for support. Include any relevant journal entries. Assume that dividend payments occur at the end of the year.