P8-53. Identifying and Analyzing Financial Statement Effects of Stock-Based Compensation The stockholders' equity of Fowler Company at December 31, 2016, follows:

7% Preferred stock, $100 par value, 20,000 shares authorized;	$400,000
4,000 shares issued and outstanding
Common stock, $15 par value, 300,000 shares authorized;	450,000
30,000 shares issued and outstanding
Paid-in capital in excess of par-value--preferred stock	36,000
Paid-in capital in excess of par-value--common stock	360,000
Retained earnings	325,000
Total stockholders' equity	$1,571,000

The following transactions, among others, occurred during the following year. 1. Employees exercised 12,000 stock options that weere granted in 2012 and had a three-year vesting period. These options had an estimated fair value of $2 at the grant date, and an exercise price of $16. There were no other vested or unvested options after this exercise. 2. Awarded 1,000 shares of stock to new executives, when the stock price was $36. 3. Sold 10,000 shares to employees under the company-wide stock purchase plan. Under the plan, employees purchased the shares at 10% discount when the stock price was $33 per share. 4. Granted 40,000 new stock options, with a strike price of $34 and an estimated fair value of $6. The options vest over three years. Required: Prepare the December 31, 2017, statement of stockholders' equity assuming that the company reports 2017 pretax income of $483,000 before the effects of stock-based compenstation. Assume the company has a 35% tax rate.