Journalizing dividends and treasury stock transactions and preparingthe stockholders equity section of the balance sheet:

Summerborn Manufacturing, Co. completed the following transactions during2014: **** Nov. 8 Treasury Stock = $6500 CR *****

Jan. 16 Declared a cash dividend on the 5%, $100 par noncumulative preferred stock(900 shares outstanding). Declared a $0.30 per share dividend on the 80,000shares of $6 par value common stock outstanding. The date of record isJanuary 31, and the payment date is February 15.

Feb.15 Paid the cash dividends.

Jun.10 Split common stock 2-for-1.

Jul. 30 Declared a 50% stock dividend on the common stock. The market value of thecommon stock was $9 per share.

Aug.15 Distributed the stock dividend.

Oct. 26 Purchased 1,000 shares of treasury stock at $13 per share.

Nov. 8 Sold 500 shares of treasury stock for $15 per share.

Nov.30 Sold 300 shares of treasury stock for $8 per share.

Requirements:

1. Record the transactions in Summerborns general journal.

2. Prepare the Summerborns stockholders equity section of the balance sheet as ofDecember 31, 2014. Assume that Summerborn was authorized to issue 2,000shares of preferred stock and 400,000 shares of common stock. Both preferredstock and common stock were issued at par. The ending balance of retainedearnings as of December 31, 2014, is $2,050,000.