M Corporation was incorporated in year 1. During year 1, the company issued 100,000 shares of $1 par value common stock for $27 per share. During year 2, the company had the following transactions. Issued 10,000 shares of $100 par value cumulative preferred stock at par. The preferred stock was convertible into five shares of common stock and had a dividend rate of 6%. 1/2/Y2 Issued 3,000 shares of common stock for legal service performed. The value of the legal services was S100,000. The stock was actively traded on a stock exchange and valued on 3/1/Y2 at $32 per share 3/1/Y2 7/1/Y2 Issued 40,000 shares of common stock for $42 per share. Repurchased 16,000 shares of treasury stock for S34 per share. M Corp. uses the cost method to account for treasury shares. 10/1/Y2 12/1/Y2 Sold 3,000 shares of treasury stock for $29 per share. Declared and paid a dividend of $0.20 per share on common stock and a 6% dividend on the preferred stock