Required information Problem 10-5B Understand stockholders' equity and the statement of stockholders' equity (LO10-7) [The following information applies to the questions displayed below.) Nautical has two classes of stock authorized: $10 par preferred, and $1 par value common. As of the beginning of 2021, 100 shares of preferred stock and 1,200 shares of common stock have been issued. The following transactions affect stockholders' equity during 2021: March 1 Issue 1,200 additional shares of common stock for $12 per share. April 1 Issue 200 additional shares of preferred stock for $22 per share. June 1 Declare a cash dividend on both common and preferred stock of $0.35 per share to all stockholders of record on June 15. June 30 Pay the cash dividends declared on June 1. August 1 Purchase 200 shares of common treasury stock for $9 per share. October 1 Resell 100 shares of treasury stock purchased on August 1 for $11 per share. Nautical has the following beginning balances in its stockholders' equity accounts on January 1, 2021: Preferred Stock, $1,000; Common Stock, $1,200; Additional Paid-in Capital, $17,700; and Retained Earnings, $9,700. Net income for the year ended December 31, 2021, is $6,750. Taking into consideration the beginning balances on January 1, 2021 and all the transactions during 2021, respond to the following for Nautical: Problem 10-5B Part 1 Required: 1. Prepare the stockholders' equity section of the balance sheet as of December 31, 2021. (Amounts to be deducted should be indicated by a minus sign.) NAUTICAL Balance Sheet (Stockholders' Equity Section) December 31, 2021 Stockholders' equity: Preferred stock [$ Common stock Additional paid-in capital 3,000 3,000 Total paid-in capital Retained earnings Treasury stock Total stockholders' equity $ 3,000 Problem 10-5B Part 2 2. Prepare the statement of stockholders' equity for the year ended December 31, 2021. (Amounts to be deducted should be indicated by a minus sign.) NAUTICAL Statement of Stockholders' Equity For the Year Ended December 31, 2021 Preferred Stock Common Stock Additional Paid-in Capital Retained Earnings Treasury Stock Total Stockholders' Equity Balance, January 1 Issue common stock Issue preferred stock Declare cash dividends Purchase treasury stock Resell treasury stock Net income Balance, December 31