Answer and Explanation:
The preparation of the statement of stockholder equity should be presented below:
<u>Statement of stockholders' equity
</u>
<u>For the year ended December 31, 20Y7
</u>
<u>Particulars Common Stock Retained Earnings Total
</u>
<u>Beginning balance, </u>
January 1 40000 815500 855500
Add: Net income 0 67250 67250
Less: Dividends paid 0 -10000 -10000
Ending balance,
December 31 40000 872750 912750