Earlgrey Company earned net Income of dollar90.000 during the year ended Decembe

Question

Earlgrey Company earned net Income of dollar90.000 during the year ended December 31. 2016. On December 15. Earlgrey declared the annual cash dividend on its 6% preferred stock (par value. dollar108,000) and a dollar1.00 per share cash dividend on its common stock (60.000 shares). Earlgrey then paid the dividends on January 4. 2017. Requirements Journalize for Earlgrey the entry declaring the cash dividends on December 15. 2016. Journalize for Earlgrey the entry paying the cash dividends on January 4. 2017. Requirement 1. Journalize for Earlgrey the entry declaring the cash dividends on December 15. 2016. (Record debits first, then credits Select the explanation on the last line of the journal entry table.)

Explanation / Answer

dividend declared 66480 To dividend payable to prf shareholders 6480 To dividend payable to eq shareholders 60000

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