value: 15.00 points The annual report for Sneer Corporation disclosed that the c

Question

value: 15.00 points The annual report for Sneer Corporation disclosed that the company declared and paid preferred dividends in the amount of $260,000 in the current year. It also declared and paid dividends on common stock in the amount of $1.40 per share. During the current year, Sneer had 1 million common shares authorized; 460,000 shares had been issued; and 244,000 shares were in treasury stock. The opening balance in Retained Earnings was $740,000 and Net Income for the current year was $240,000. Required 1. Prepare journal entries to record the declaration, and payment, of dividends on (a) preferred and (b) common stock. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Record the declaration of a cash dividend of $260,000 to the preferred stockholders. 1 2 Record the payment of the cash dividend to the preferred stockholders Record the declaration of a cash dividend of $1.40 per share to the common stockholders payable on the shares outstanding 3 Credit Record the payment of the cash dividend to the common stockholders 4

Explanation / Answer

Journal entry :

Statement of retained eanrings :

date accounts & explanation debit credit Preferrred dividend a/c 260000 Preferred dividend payable a/c 260000 (To record preferred dividend declared) Preferred dividend payable a/c 260000 Cash a/c 260000 (TO record preferred dividend paid) Common stock dividend a/c 302400 Common stock dividend payable a/c 302400 (To record common stock dividend payable) Common stock dividend payable a/c 302400 common stock a/c 302400 (To record common stock dividend paid)

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