Question 1 (23 marks) < PART A (19 marks) < During 2020, Sun Travel Company ("Sun Travel") had the following stocks transactions: Date January 1 January 1 April 15 July 1 October 1 December 31 December 31 Transaction Issued 40,000 shares of no par value common stock in exchange of a building. The cost of the building was $200,000 and the market value was $280,000 on January 1. Issued 10,000 shares of $3 par value 5% preferred stock for $110,000 Sun Travel is authorized to issue 50,000 shares of preferred stocks. Sun Travel purchased 8,000 shares of of its own common stock for $6 per share. 2 2,000 of the treasury stocks are sold for $9 per share. < 2,500 of the treasure stocks are sold for $5 per share. < Declared and paid dividend in cash on preferred stocks. Declared and paid $0.5 per share cash dividend on common stocks outstanding in the market. Closed the $69,000 credit balance of Net Income in Income Summary after preferred and common stocks dividend payment 2 e 2 2 2 2 2 2 2 2 2 2 Required: 1) 2) Journalize the stock transactions of Sun Travel in 2020. Explanations of the transactions are not required. Prepare Sun Travel stockholder's equity section of the Balance Sheet as at 31 December 2020. (Hint: Refer to the textbook - Exhibit 7 "Method 1" (p.610)) < PART B (4 marks) < Explain two major differences in the rights of stockholders between common stocks and preferred stocks +