Stockholders' Equity Transactions, Journal Entries, and T-Accounts The stockholders' equity of Black Corporation at January 1 follows: 8 Percent preferred stock, $100 par value, 20,000 shares authorized: 5,000 shares issued and outstanding $500,000 Common stock, $1 par value, 100,000 shares authorized: 40,000 shares issued and outstanding 40,000 Paid-in capital in excess of par value-Preferred stock 200,000 Paid-in capital in excess of par value-Common stock 800,000 Retained earnings 625,000 Total Stockholders' Equity $2,165,000 The following transactions, among others, occurred during the year: Jan. 1 Announced a 4-for-1 common stock split reducing the par value of the common stock to 50.25 per share. Converted $75,000 face value of convertible bonds payable (the book value of the bonds was $83.000) to common stock. Each $1,000 bond converted to 110 shares of common stock.(Round common stock entry in Mar. 31 whole dollars. Round up.) June 1 Acquired equipment with a fair market value of $90,000 in exchange for 300 shares of preferred stock. Sept. 1 Acquired 15,000 shares of common stock for cash at $20 per share. Nov. 21 Issued 5.000 shares of common stock at $22 cash per share. Dec 28 Sold 1,000 treasury shares at $23 per share. 31 Closed net income of $145,000, to the Retained Earnings account. U a. Set up T-accounts for the stockholders' equity accounts as of the beginning of the year and enter the January 1 balances. Hint: Complete part b. below prior to entering any additional T-account data. Note: Round answers to the nearest whole number, when needed. Cash Bonds Payable Mar 31 Sep.01 Nov.21 Dec. 28 Premium on Bonds Payable Mar 31 Equipment Jun 01 Preferred Stock Common Stock Beg Jun.01 (4 for 1 split) Bal. Beg. Jan. 01 Mar 31 Nov.21 Bal. Paid-in-Capital in Excess of Par Value - Preferred Stock Beg. Jun.01 Bal. Paid-in-Capital in Excess of Par Value - Common Stock Beg Mar 31 Nov.21 Bal. Treasury Stock - Common Paid-in-Capital from Treasury Stock Dec.28 Bal. Dec. 28 1 Sept:01 Dec.28 Bal Retained Earnings Bal. Dec.31 Bal. b. Prepare journal entries for the given transactions and post them to the T-accounts above in part a. Do not prepare the journal entry for the Dec. 31 transaction, but post the appropriate amount to the Retained Earnings T-account. Determine the ending balances for the stockholders' equity accounts. General Journal Description (Memorandum) Common Stock split 2 for 1. Debit Date Jan.01 Mar 31 Credit Premium on Bonds Payable Common Stock To record conversions of bonds. Jun.01 Paid-in-Capital in Excess of Par Value - Preferred Stock issued preferred stock in exchange for equipment. Sept.01 Purchased treasury stock. Nov.21 Common Stock issued common stock. Dec.28 Paid-in-Capital from Treasury Stock To record sale of treasury stock