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The shareholders’ equity section of Superior Corporation’sbalance sheet as of December 31, 2015, is as follows: Shareholders’Equity Preferred stock, $100 par value; authorized, 300,000 shares;issued, 33,000 shares $3,300,000 Common stock, $5 par value;authorized, 2,000,000 shares; issued, 377,000 shares 1,885,000Paid-in capital in excess of par—preferred 96,000 Paid-in capitalin excess of par—common 825,000 Retained earnings 2,920,000$9,026,000 The following events occurred during 2016: Jan. 5 10,500shares of authorized and unissued common stock were sold for $7 pershare. 16 10,000 shares of authorized and unissued preferred stockwere sold for $108 per share. Apr. 1 79,000 shares of common stockwere repurchased for the treasury at a price of $21 per share.Superior uses the cost method to account for treasury stock. Sept.1 3,500 shares of preferred stock are issued in exchange for apiece of land. The land has an appraised value of $389,500. Thepreferred stock currently trades on the New York Stock Exchange ata price of $109 per share. Dec. 1 24,000 shares of treasury stockare reissued at a price of $24 per share.

Required: 1. Prepare journal entries for each of the abovetransactions.

2. Calculate the number of authorized, issued, and outstandingcommon shares as of December 31, 2016.

3. Calculate Superior’s legal capital at December 31, 2016.