"Stockholders' Equity" section of balance sheetSpecialty Auto Racing Inc. retails racing products for BMWS, Porsches, and Ferraris. The following accounts and their balances appear in theledger of Specialty Auto Racing on July 31, the end of the current year:Common Stock, $10 par$400,000Paid-In Capital from Sale of Treasury Stock-CommonPaid-In Capital in Excess of Par-Common StockPaid-In Capital in Excess of Par-Preferred Stock30,200120,00061,800Preferred 4% Stock, $50 par1,030,000Retained Earnings2,003,200Treasury Stock-Common38,500Fifty thousand shares of preferred and 200,000 shares of common stock are authorized. There are 3,500 shares of common stock held astreasury stock.Prepare the Stockholders' Equity section of the balance sheet as of July 31, the end of the current year using Method 1 of Exhibit 9.Specialty Auto Racing Inc.Stockholders' EquityJuly 31, 20XXPaid-In Capital:Preferred 4% Stock, $50 Par (50,000 Shares Authorized, 20,600 Shares Issued)Excess of Issue Price Over ParPaid-in capital, preferred stockCommon Stock, $10 Par (200,000 Shares Authorized, 40,000 Shares Issued)Excess of Issue Price Over ParPaid-in capital, common stockFrom Sale of Treasury StockTotal Paid-In CapitalRetained EarningsTotalTreasury Stock (3,500 Shares at Cost)Total Stockholders' Equity

The statement of stockholders' equity records the details of issued capital and retained earnings of the business that belongs to total shareholders. Specialty Auto Racing Inc. Paid in capital: Preferred 4% stock, $50 par (50,000 shares authorized, 20,600 shares issued) 1,030,000 Excess of issue price over par 61,800 Paid in capital preferred stock 1,091,800 Common stock, $10 par (200,000 shares authorized, 40,000 shares issued) 400,000 Excess of issue price over par 120,000 Paid in capital, common stock 520,000 From sale of treasury stock 30,200 Total paid in capital 1,642,000 Retained earnings 2,003,200 Total 3,645,200 Treasury stock (3,500 shares at cost) (38,500) Total stockholders’ equity 3,606,700