A company issues stock in a bundled package as follows: 600 shares of $2 par common stock currently valued at $26 per share and 400 shares of $10 par preferred stock currently valued at $16 per share. The bundled price at issuance is $20,000

Required: (Please show work)

a. Use a relative fair market value allocation to determine total allocated issuance price for each class of stock (common and preferred). (round final answers to the nearest dollar.)

b. Prepare the journal entry required at the date of issuance.