Kirk and Kirk, Ltd. began operations in July 2011 and reported the following results for each of its first 3 years of operations. 2011 - $20,000 net income 2012 - $640,000 net loss 2013 - $950,000 net income At December 31, 2013, Kirk and Kirk, Ltd.s capital accounts were as follows. 16% cumulative preferred stock, par value $100; authorized, issued, and outstanding 1,000 shares $100,000 Common stock, par value $1; authorized 10,000,000 shares; issued and outstanding 50,000 shares 50,000 Kirk and Kirk, Ltd. has never paid a cash or stock dividend. There has been no change in the capital accounts since Kirk and Kirk, Ltd. began operations. The state law permits dividends only from retained earnings. Instructions (a) Compute the book value of the common stock at December 31, 2013. (b) Compute the book value of the common stock at December 31, 2013, assuming that the preferred stock has a liquidating value of $103 per share. Capital Northeast Corporations post-closing trial balance at December 31, 2012, was as follows. CAPITAL NORTHEAST CORPORATION POST-CLOSING TRIAL BALANCE December 31, 2012 Dr. Cr. Accounts payable $668,000 Accounts receivable $605,000 Accumulated depreciation-equipment 450,000 Additional paid-in capital-common In excess of par value 1,900,000 From sale of treasury stock 35,000 Allowance for doubtful accounts 20,000 Equipment 6,800,000 Cash 260,000 Common stock ($1 par value) 500,000 Dividends payable on common stockcash 50,000 Inventories 750,000 Investments 2,500,000 Preferred stock ($100 par value) 6,500,000 Prepaid insurance 65,000 Retained earnings 982,000 Treasury stock-common at cost 125,000 Totals $11,105,000 $11,105,000 At December 31, 2012, Capital Northeast had the following number of common and preferred shares. Common Preferred Authorized 2,500,000 1,000,000 Issued 500,000 65,000 Outstanding 490,000 65,000 The dividends on preferred stock are 6% cumulative. In addition, the preferred stock has a preference in liquidation of $102 per share. Instructions Prepare the stockholders equity section of Capital Northeasts balance sheet at December 31, 2012