Moon Corporation received a charter that authorized the issuance of 80,000 shares of $7 par common stock and 19,000 shares of $100 par, 5 percent cumulative preferred stock. Moon Corporation completed the following transactions during its first two years of operation:

Year 1

Jan.	5		Sold 12,000 shares of the $7 par common stock for $9 per share.
	12		Sold 1,900 shares of the 5 percent preferred stock for $110 per share.
Apr.	5		Sold 16,000 shares of the $7 par common stock for $11 per share.
Dec.	31		During the year, earned $303,800 in cash revenue and paid $235,800 for cash operating expenses.
	31		Declared the cash dividend on the outstanding shares of preferred stock for Year 1. The dividend will be paid on February 15 to stockholders of record on January 10, Year 2.

Year 2

Feb.	15		Paid the cash dividend declared on December 31, Year 1.
Mar.	3		Sold 2,850 shares of the $100 par preferred stock for $120 per share.
May	5		Purchased 400 shares of the common stock as treasury stock at $14 per share.
Dec.	31		During the year, earned $252,800 in cash revenues and paid $173,800 for cash operating expenses.
	31		Declared the annual dividend on the preferred stock and a $0.75 per share dividend on the common stock.

Required

1. Organize the transaction data in accounts under an accounting equation.
2. Prepare the stockholders equity section of the balance sheet at December 31, Year 1.
3. Prepare the balance sheet at December 31, Year 2.

Accounting Equation Stockholders' Equity Event Assest Liabilities + Cash = Dividends Payable + Preferred Stock + Common Stook + Paid-in Capital in Excess of Preferred Stock Paid-in Capital in + Excess of Common Stock Treasury Stook + Retained Earnings Account Titles for Retained Earnings Year 1 Jan.5 + Jan. 12 Apr.5 Dec.31 + IIIIIII + + + + + + + + + + + + + + + + + + Service revenue + + + + Dec.31 Dec.31 Operating expenses Dividends + + + + Bal. 0= 0 + 0 + 0 + 0 + 0 0 + 0 Year 2 Feb. 15 + + Mar3 + + +++ + + + + May 5 Dec.31 Dec.31 + + + + + + + + Service revenue Operating expenses Dividends Dec.31 + + + + + Bal. 0 + O + 0 + 0 + 0 0+ 0 Balance Sheet (Partial) As of December 31, Year 1 Stockholders' equity Cash Common stock Total paid in capital 0 Total stockholders' equity $ 0 Balance Sheet As of December 31, Year 2 Assets Cash $ $ 0 Total assets Liabilities Dividend payable $ 0 Total liabilities Stockholders equity Total paid-in capital 0 0 Total stockholders equity Total liabilities and stockholders' equity $ 0