Baker Inc., was authorized to issue 6,000 shares of $100 par value, 8 percent cumulative preferred stock, and 100,000 shares of $2 stated value common stock. Half of the preferred stock was issued at a price of $103 per share, and 70,000 shares of the common stock were sold for $13 per share. At the end of the current year, Baker Inc. has retained earnings of $382,000.

a. Prepare the stockholders' equity section of the company's balance sheet at the end of the current year.

b. Assume Baker Inc. common stock is trading at $24 per share and its preferred stock is trading at $107 per share at the end of the next year. Prepare the stockholders' equity section of the company's balance sheet at the end of the next year.

c. Compare the stockholders' equity section of both year and critical analysis and comment on the financial position of the company