Troutman Corporation has 6,790 shares of common stock outstanding. It declares a
ID: 2476908 • Letter: T
Question
Troutman Corporation has 6,790 shares of common stock outstanding. It declares a $4 per share cash dividend on November 1 to stockholders of record on December 1. The dividend is paid on December 31.
Prepare the entries on the appropriate dates to record the declaration and payment of the cash dividend. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)
Date
Account Titles and Explanation
Debit
Credit
Date
Account Titles and Explanation
Debit
Credit
Nov. 1Dec. 31
Nov. 1Dec. 31
Explanation / Answer
1. Journal Entry for the Declaration of Dividend :
Nov 1st
Dividends a/c dr - $27,160
To Dividends Payable a/c cr - $27,160
2.Journal Entry at the time of payment of Dividend :
Dec 31st
Dividends Payable a/c dr - $27,160
To Cash a/c cr - $27,160
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