Required Information Problem 11-26A (Algo) Recording and reporting stock transactions and cash dividends across two accounting cycles LO 11-3, 11-6 [The following information applies to the questions displayed below.] Sun Corporation recelved a charter that authorized the issuance of 85,000 shares of $6 par common stock and 22,000 shares of $100 par, 4 percent cumulative preferred stock. Sun Corporation completed the following transactions during its first two years of operation. Year 1 Jan. 5 Sold 12,750 shares of the $6 par common stock for $8 per share. 12 Sold 2,200 shares of the 4 percent preferred stock for $110 per share. Apr. 5 Sold 17,eee shares of the $6 par common stock for $10 per share. Dec. 31 During the year, earned $311,989 in cash revenue and paid $238,400 for cash operating expenses. 31 Declared the cash dividend on the outstanding shares of preferred stock for Year 1. The dividend will be paid on February 15 to stockholders of record on January 19, Year 2. Year 2 Feb.15 Paid the cash dividend declared on December 31, Year 1. Mar. 3 Sold 3,300 shares of the $180 par preferred stock for $120 per share. May. 5 Purchased 500 shares of the common stock as treasury stock at $12 per share. Dec. 31 During the year, earned $248,488 in cash revenues and paid $175,000 for cash operating expenses. 31 Declared the annual dividend on the preferred stock and a $8.50 per share dividend on the common stock. c-1. What is the number of common shares outstanding at the end of Year 1? At the end of Year 2? How many common shares had been issued at the end of Year 1? At the end of Year 27 (Amounts to be deducted should be indicated with minus sign.) Schedule of Number of Shares of Common Stock Shares Shares Issued Outstanding Year 1 12.750 Jan. 5 Apr. 5 17.000 29.750 0 Totals Year 2 Totals 29.750 0 c-2. Are there any differences between issued and outstanding common shares for Year 1 and Year 2? Issued common shares Outstanding common shares Required Use the following Information to prepare a multistep Income statement and a classified balance sheet for Eller Equipment Co. for Year 1. (Hint: Some of the items will not appear on elther statement, and ending retained earnings must be calculated.) Salaries expense Common stock Notes receivable (short term) Allowance for doubtful accounts Accumulated depreciation Notes payable (long term) Salvage value of building Interest payable (short term) Uncollectible accounts expense Supplies Equipment Interest revenue Sales revenue Dividends Warranty expense Interest receivable (short term) $122,eee Beginning retained earnings 110,089 Warranties payable (short term) 32,580 Gain on sale of equipment 19,eee Operating expenses 65,000 cash flow from investing activities 160,089 Prepaid rent 21,088 Land 6,088 Cash 45, eee Inventory 6,580 Accounts payable 243, eee Interest expense 6,289 Salaries payable 940,000 Unearned revenue 20,89 Cost of goods sold 9,288 Accounts receivable 3,609 Depreciation expense $ 61,100 6,500 19 , 65,800 116,800 38, see 95,000 41,eee 181,880 55,eee 36,800 68,888 47, see 595,000 188,888 3,000 Complete this question by entering your answers in the tabs below. Income Balance Sheet Statement Prepare a multistep income statement for Eller Equipment Co. for Year 1. (Amounts to be deducted should be indicated with a minus sign.) ELLER EQUIPMENT CO. Income Statement For the Year Ending December 31, Year 1 0 Operating expenses Total operating expenses 0 0 Non-operating items Total non-operating items 0 0 Income Statement Balance Sheet Prepare a classified Balance sheet for Eller Equipment Co. for Year 1. (Amounts to be deducted should be indicated with a minus sign.) ELLER EQUIPMENT CO. Balance Sheet As of December 31, Year 1 Assets 0 Total current assets S 0 Property, plant and equipment 0 Total property, plant and equipment Total assets S 0 Liabilities and Stockholders' Equity Current liabilities 0 Total current liabilities Long-term liabilities 0 Total long-term liabilities Total liabilities Stockholders' equity 0 0 Total stockholders' equity Total liabilities and stockholders' equity S 0