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-8 P11-4A. Stockholders' Equity: Transactions and Balance Sheet Presentation The stockholders' equity of Peak Corporation at January 1 follows: $ 500,000 7 Percent preferred stock,

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-8 P11-4A. Stockholders' Equity: Transactions and Balance Sheet Presentation The stockholders' equity of Peak Corporation at January 1 follows: $ 500,000 7 Percent preferred stock, $100 par value, 20,000 shares authorized: 5,000 shares issued and outstanding. Common stock. $15 par value, 100,000 shares authorized; 40,000 shares issued and outstanding .... Paid-in capital in excess of par value-Preferred stock Paid-in capital in excess of par value-Common stock Retained earnings Total Stockholders' Equity.. + 600,000 24,000 360,000 325,000 $1,809,000 The following transactions, among others, occurred during the year: Jan. 12 Announced a 4-for-1 common stock split, reducing the par value of the common stock to $3.75 per share. The authorization was increased to 400,000 shares. Mar. 31 Converted $40,000 face value of convertible bonds payable (the book value of the bonds was $43,000) to common stock. Each $1,000 bond converted to 125 shares of common stock June 1 Acquired equipment with a fair market value of $90,000 in exchange for 500 shares of preferred stock Sept. 1 Acquired 10,000 shares of common stock for cash at $10 per share. Oct. 12 Sold 1,500 treasury shares at $12 per share. Nov. 21 Issued 5,000 shares of common stock at $11 cash per share. Dec. 28 Sold 1,200 treasury shares at $9 per share. 31 Closed net income of $105,000 to the Retained Earnings account. Required Set up T-accounts for the stockholders' equity accounts as of the beginning of the year and enter the January 1 balances. b. Prepare journal entries for the given transactions and post them to the T-accounts (set up any additional T-accounts needed). 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. Prepare the stockholders' equity section of the balance sheet at December 31. c

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