Donnie Hilfiger has two classes of stock authorized: $1 par preferred and $.01 p

Question

Donnie Hilfiger has two classes of stock authorized: $1 par preferred and $.01 par value common. As of the beginning of 2012, 230 shares of preferred stock and 2,480 shares of common stock have been issued. The following transactions affect stockholders' equity during 2012:

Declares a cash dividend on both common and preferred stock of $.60 per share to all stockholders of record on December 15. (Hint: Dividends are not paid on treasury stock.)

Donnie Hilfiger has the following beginning balances in its stockholders' equity accounts on January 1, 2012: Preferred Stock, $230; common Stock, $24.80; Additional Paid-in Capital, $75,000; and Retained Earnings, $25,500. Net income for the year ended December 31, 2012, is $9,200.

I NEED HELP ONLY WITH DEC.1!!!! I KNOW TRANSACTION WILL BE: Dividends(D)=?; Dividends payable(C)=?

Donnie Hilfiger has two classes of stock authorized: $1 par preferred and $.01 par value common. As of the beginning of 2012, 230 shares of preferred stock and 2,480 shares of common stock have been issued. The following transactions affect stockholders' equity during 2012:

Explanation / Answer

Dec 1 - DR -Retained EarningsCR Div Payable 2,850

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