Shelby Corporation was organized in January to operate an air$-$conditioning sales and service business. The charter issued by the

state authorized the following capital stock:

Common stock, $$1$ par value, $200,000$ shares.

Preferred stock, $$10$ par value, $6$ percent, $50,000$ shares.

During January and February, the following stock transactions were completed:

a$.$ Collected $$100,000$ cash and issued $10,000$ shares of common stock.

b$.$ Issued $10,000$ shares of preferred stock at $$20$ per share; collected in cash.

Net income for the year was $$40,000$; cash dividends declared and paid at year$-$end were $$12,000.$

Required:

Prepare the stockholders' equity section of the balance sheet at December $31.($Helpful tool: Record Journal Entries for each $($A$-$D$)$

transaction before attempting to complete the balance sheet below$)$