Red Apple Company has the following stockholders equity accounts at December 31, 2017.

Common Stock ($60 par value, authorized 25,000 shares) $900.000

Retained Earnings 569,000

Prepare entries in journal form to record the following transactions, which took place during 2018.

400 shares of outstanding stock were purchased at $73 per share. (These are to be accounted for using the cost method.)

A $4 per share cash dividend was declared.

The dividend declared in (2) above was paid.

The treasury shares purchased in (1) above were resold at $78 per share.

380 shares of outstanding stock were purchased at $80 per share.

250 of the shares purchased in (5) above were resold at $71 per share.

(b) Prepare the stockholders equity section of Red Apple Companys balance sheet after giving effect to these transactions, assuming that the net income for 2018 was $161,000. State law requires restriction of retained earnings for the amount of treasury stock.