On December 31 2013 Andes Company Had 1500000 Shares Of

On December 31, 2013, Andes Company had 1,500,000 shares of $10 par common stock issued and outstanding. The stockholders’ equity accounts at December 31, 2013, had the following balances.
Common Stock ……….$15,000,000
Additional Paid-in Capital ……. 1,500,000
Retained Earnings ……… 900,000
Transactions during 2014 and other information related to stockholders’ equity accounts were as follows.
1. On January 10, 2014, Andes issued at $105 per share 100,000 shares of $100 par value, 8% cumulative preferred stock.
2. On February 8, 2014, Andes reacquired 20,000 shares of its common stock for $14 per share.
3. On June 8, 2014, Andes declared a cash dividend of $1 per share on the common stock outstanding, payable on July 10, 2014, to stockholders of record on July 1, 2014.
4. On December 15, 2014, Andes declared the yearly cash dividend on preferred stock, payable January 10, 2015, to stockholders of record on December 15, 2014.
5. Net income for the year is $3,600,000.
6. It was discovered that depreciation expense had been understated in 2013 by $65,000.

Instructions
(a) Prepare a retained earnings statement for the year ended December 31, 2014.
(b) Prepare the stockholders’ equity section of Andes’s balance sheet at December 31, 2014.

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