Arial Company had the following transactions in the first year of its operations. A. On January 10, 2005, the company issued 100,000 shares of its $5 par common stock for $8 per share and 20,000 shares of its $40 par, 6 percent preferred stock for $48 per share. B. On March 1, the company issued 10,000 shares of common and 4,000 shares of pre- ferred for $330,000. The market value of the common stock and the preferred stock on March 1 was $10 and $50, respectively. C. On June 1, the company issued 8,000 shares of common stock to its legal counsel as payment for legal services. The legal counsel had billed for 1,000 hours of service, and the normal billing fee is $100 to $120 per hour. The market price of the common stock on June 1 was $11 per share. D. On July 1, 5,000 shares of common stock were purchased as treasury stock at $14 per share. E. On December 15, the board of directors voted to pay the annual cash dividend to pre- ferred stockholders on January 20, 2006. E On December 31, the company determined that its income for the year was $405,000. Required: 1. Record journal entries for these transactions for 2005. 2. Develop the stockholders' equity section of the balance sheet as of December 31, 2005. Date Accounts ACC Debit the normal billing fee is $100 to $120 per hour. The market price on June 1 was $11 per share. D. On July 1, 5,000 shares of common stock were purchased as treasury stock at $14 per share. E On December 15, the board of directors voted to pay the annual cash dividend to pre ferred stockholders on January 20, 2006. F. On December 31, the company determined that its income for the year was $405,000. Required: 1. Record journal entries for these transactions for 2005. 2. Develop the stockholders' equity section of the balance sheet as of December 31, 2005. Date Accounts Debit Credit