Analyzing stockholders equity (Learning Objectives 2, 3, & 4) 2025 min. Davenport, Inc., included the following stockholders

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Analyzing stockholders’ equity (Learning Objectives 2, 3, & 4) 20–25 min.

Davenport, Inc., included the following stockholders’ equity on its year-end balance sheet at December 31, 2014, with all dollar amounts, except par value per share, adapted and in millions:

Paid-in Capital:

Preferred Stock, 8% cumulative, par value $50 per share;

10,000,000 shares authorized, 1,000,000 shares issued and outstanding Common Stock, par value $2 per share; 800,000,000 shares authorized, 160,000,000 shares issued and outstanding Paid-in Capital in Excess of Par—Common Total Paid-in Capital Retained Earnings Total Stockholders’ Equity

$ 50 320 82

$452 216

$668 Stockholders’ Equity $ Millions Requirements 1. Identify the different issues of stock Davenport, Inc., has outstanding.

2. Give the two entries to record issuance of the Davenport, Inc.’s stock. Assume all the stock was issued for cash. Explanations are not required.

3. Assume that preferred dividends are in arrears for 2013 and 2014. Record the declaration of a $31 million cash dividend on December 30, 2015. Assume no change in the preferred stock account in 2015. Use separate Dividends Payable accounts for preferred and common stock. Round to the nearest $1 million. An explanation is not required.

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Financial Accounting

ISBN: 9781292019543

3rd Global Edition Edition

Authors: Robert Kemp, Jeffrey Waybright, Pearson Education

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