Answer and Explanation:
The Preparation of statement of stockholders’ equity is shown below:-
<u> Statement of Stockholder's Equity</u>
<u> Power Drive Corporation</u>
<u> For the year ended December 31, 2018</u>
<u>Particulars Common Additional Retained Treasury Total</u>
<u> stock paid in Earning Stock Stockholder</u>
<u> capital equity</u>
Jan 1 Balance 100,000 $4,800,000 $2,300,000 0 $7,200,000
Issued common
stock 58,000 $3,132,000 0 0 $3,190,000
(58,000 × $1) (58,000 × $54)
Purchase treasury
stock -$307,400 -$307,400
(5,300 × $58)
Dividends -$251,955 -$251,955
((100,000 + 58,000 - 5,300) × $1.65)
Sale of Treasury
stock $13,250 $153,700 $166,950
(2,650 × $5) (2,650 × $58)
Net Income $630,000 $630,000
Balance,
December
31 158,000 $7,945,250 $2,678,045 -$153,700 $10,627,595
Total Stockholder's equity is
= Common stock + Additional paid in capital + Retained earnings - Treasury stock
= 158,000 + $7,945,250 + $2,678,045 - $153,700
= $10,627,595
