A company\'s board of directors votes to declare a cash dividend of $1.00 per sh

Question

A company's board of directors votes to declare a cash dividend of $1.00 per share on its 12,000 common shares outstanding. The journal entry to record the declaration of the cash dividend is: a) Debit Dividend Expense $12,000; credit Cash 412,000. b) Debit Dividend Expense $12,000; credit Common Dividend Payable $12,000. c) Debit Common Dividend Payable $12,000; credit Cash $12,000. d) Debit Retained Earnings $12,000; credit Common Dividend Payable $12,000. e) Debit Common Dividend $12,000; credit Retained Earnings $12,000.

Explanation / Answer

Option D is correct

Debit Retained Earnings(12,000 x 1) $12,000

credit Common Dividend Payable $12,000

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.