PROBLEM 8-18 a. Davis Corporation Accounting Equation Event Assets = Liabilities Stockholders' Equity Cash = Div. Pay. + Pfd. Stk. + Com. Stk. + PIC in Exc. PS + PIC in Exc. CS ? Treasury Stock + Ret. Earn. Acct. Title R/E 2012 1/2 140,000 NA NA 50,000 NA 90,000 NA NA 1/15 70,000 NA 50,000 NA 20,000 NA NA NA 2/14 450,000 NA NA 150,000 NA 300,000 NA NA 12/31 170,000 NA NA NA NA NA NA 170,000 Svc. Rev. 12/31 (110,000) NA NA NA NA NA NA (110,000) Op. Exp. 12/31* NA 3,000 NA NA NA NA NA (3,000) Div. Bal. 720,000 = 3,000 + 50,000 + 200,000 + 20,000 + 390,000 ? -0- + 57,000 2013 1/31 (3,000) (3,000) NA NA NA NA NA NA 3/1 116,000 NA 100,000 NA 16,000 NA NA NA 6/1 (21,500) NA NA NA NA NA 21,500 NA 12/31 210,000 NA NA NA NA NA NA 210,000 Svc. Rev. 12/31 (175,000) NA NA NA NA NA NA (175,000) Op. Exp. 12/31** NA 20,700 NA NA NA NA NA (20,700) Div. Bal. 846,500 = 20,700 + 150,000 + 200,000 + 36,000 + 390,000 ? 21,500 + 71,300 *Preferred Stock: $50 x 6% x 1,000 shares = $3,000 **Preferred Stock: $50 x 6% x 3,000 shares = $ 9,000 Common Stock: Shares outstanding, 19,500 x $.6 = 11,700 Total Dividend $20,700 PROBLEM 8-18 (cont.) b. 2012 Stockholders' Equity Preferred Stock, $50 par value, 5% cumulative, 50,000 shares authorized, 1,000 shares issued and outstanding $ 50,000 Common Stock, ...
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