Purpose: (L.O. 7) This exercise will illustrate how the components of stockholders' equity should be reported in the balance sheet.
Al Gore Corporation's charter authorizes 200,000 shares of $20 par value common stock, and 50,000 shares of 6% cumulative preferred stock, par value $100 per share. The preferred stock has a call price of $105.
The corporation engaged in the following stock transactions between the date of incorporation and December 31, 2014:
At December 31, 2014, Gore's retained earnings balance was $2,200,000.
Prepare the stockholders' equity section of the balance sheet at December 31, 2014, in good form.