On February 15, Seacroft buys 6,700 shares of Kebo common stock at $ 28.66 per s

Question

On February 15, Seacroft buys 6,700 shares of Kebo common stock at $ 28.66 per share plus a brokerage fee of $400. The stock is classified as available-for-sale securities. On March 15, Kebo declares a dividend of $1.18 per share payable to stockholders of record on April 15. Seacroft received the dividend on April 25 and ultimately sells half of the Kebo stock on November 17 of the current year for $29.43 per share less a brokerage fee of $250. The journal entry to record the dividend on April 25 is:

Explanation / Answer

On February 15, Seacroft buys 6,700 shares of Kebo common stock Kebo declares a dividend of $1.18 per share The journal entry to record the dividend on April 25 is: 6,700 x1.18 = 7,906 Debit Cash $7,906; credit Dividend Revenue $7,906.

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