Major League Apparel has two classes of stock authorized: 4%, $10 par preferred, and $1 par value common. The following transactions affect stockholders equity during 2021, its first year of operations:

January		2		Issue 120,000 shares of common stock for $65 per share.
February		14		Issue 55,000 shares of preferred stock for $13 per share.
May		8		Purchase 12,000 shares of its own common stock for $55 per share.
May		31		Resell 6,000 shares of treasury stock for $60 per share.
December		1		Declare a cash dividend on its common stock of $0.75 per share and a $22,000 (4% of par value) cash dividend on its preferred stock payable to all stockholders of record on December 15. The dividend is payable on December 30. (Hint: Dividends are not paid on treasury stock.)
December		30		Pay the cash dividends declared on December 1.

Problem 10-6A Record equity transactions and prepare the stockholders' equity section (LO10-2, 10-3, 10- 4, 10-5, 10-7) [The following information applies to the questions displayed below. Major League Apparel has two classes of stock authorized: 4%, $10 par preferred, and $1 par value common. The following transactions affect stockholders' equity during 2021, its first year of operations: January 2 Issue 120,000 shares of common stock for $65 per share. February 14 Issue 55,000 shares of preferred stock for $13 per share. May 8 Purchase 12,000 shares of its own common stock for $55 per share. May 31 Resell 6,000 shares of treasury stock for $60 per share. December 1 Declare a cash dividend on its common stock of $0.75 per share and a $22,000 (4% of par value) cash dividend on its preferred stock payable to all stockholders of record on December 15. The dividend is payable on December 30. (Hint: Dividends are not paid on treasury stock.) December 30 Pay the cash dividends declared on December 1. Problem 10-6A Part 2 2. Prepare the stockholders' equity section of the balance sheet as of December 31, 2021. Net income for the year was $485,000. (Amounts to be deducted should be indicated by a minus sign.) MAJOR LEAGUE APPAREL Balance Sheet (Stockholders' Equity Section) December 31, 2021 Stockholders' Equity: Common Stock Preferred Stock Additional Paid-in Capital 0 Total Paid-in Capital Retained Earnings Treasury Stock Total Stockholders' Equity $ 0