Tandy Company was issued a charter by the state of Indiana on January 15 of this year. The charter authorized the following: Common stock, $7 par value, 119,000 shares authorized Preferred stock, 13 percent, par value $6 per share, 5,400 shares authorized During the year, the following transactions took place in the order presented: Sold and issued 21,000 shares of common stock at $12 cash per share. Sold and issued 2,000 shares of preferred stock at $16 cash per share. At the end of the year, the accounts showed net income of $40,600. No dividends were declared.