Cleves Company reported the following amounts in the stockholders equity section of its December 31, 2019, balance sheet. Preferred stock, 10%, $100 par (10,000 shares authorized, 2,000 shares issued) $200,000 Common stock, $5 par (100,000 shares authorized, 20,000 shares issued) $100,000 Additional paid-in capital $125,000 Retained earnings $450,000 Total $875,000

During 2020, Cleves took part in the following transactions concerning stockholders equity.

1. Paid the annual 2019 $10 per share dividend on preferred stock and a $2 per share dividend on common stock. These dividends had been declared on December 31, 2019.

2. Purchased 1,700 shares of its own outstanding common stock for $40 per share. Cleves uses the cost method.

3. Reissued 700 treasury shares for cash of $30,000.

4. Issued 500 shares of preferred stock at $105 per share.

5. Declared a 10% stock dividend on the outstanding common stock when the stock is selling for $45 per share.

6. Issued the stock dividend.

7. Declared the annual 2020 $10 per share dividend on preferred stock and the $2 per share dividend on common stock. These dividends are payable in 2021.

8. Net income for the year is $330,000 (make closing entry)

Instructions:

a. Prepare journal entries for the above transactions 1-8

b. Prepare the stockholders' equity section of the balance sheet at 12/31/20