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Edit View History Bookmarks People Window Help Blackboard Learn G Google Secure https://blackboard9.wccnet.edu/webapps/ubsh-Iti-integration-BBLEARN/app/content/launchHandler?c tenaw ONLING My Institution Courses Careers ACC 111:-Principles of Accounting I-Section 06 Fall 2017 myBusinessCourse Chapter 11 Homework inessCourse Menu Cash Dividends Sanders Corporation has the following shares outstanding: 7,000 shares of $50 par value, six percent preferred stock and 45,000 shares of $1 par value common stock. The company has $328,000 of retained earnings. At year-end, the company declares its regular $3 per share cash dividend on the preferred stock and a $2.20 per share cash dividend on the common stock. Three weeks later, the company pays the dividends. a. Prepare the journal entry for the declaration of the cash dividends. b. Prepare the journal entry for the payment of the cash dividends. General Journal Ref Description Debit Credit a. Dividends Payable-Common Stock 0 To record declaration of dividend on preferred stock and common stock b. l/mybusinesscourse.com/platform/mod/quiz/attempt.php?attempt-15-

Explanation / Answer

1. Given :- Prefernce shares issued are 7000 and $50 par value at 6% p.a. and common stock 45000 shares of 1$ par value

Journal entry for dividend declared for both categories of shares is ($)

Retained earnings A/c Dr. 120000

To dividend payable A/c 120000

(Being dividend declared)

B:- For payment of cash dividends

Dividend Payable A/c Dr. 120000

To Cash A/c 120000

(Being dividend paid )

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