On May 20, the board of directors for Auction.com declared a cash dividend of 50

Question

On May 20, the board of directors for Auction.com declared a cash dividend of 50 cents per share payable to stockholders of record on June 14. The dividends are paid on July 14. The company has 512,000 shares of stock outstanding. Closing entries are recorded on July 31. Prepare any necessary journal entries for each date. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Record the entry on the date of declaration for a cash dividend of 50 cents per share payable on the 512,000 shares of stock outstanding. 1 ents per Record the entry on the date of record for a cash dividend of 50 cents per share payable on the 512,000 shares of stock outstanding. 2 Record the entry on the date of payment for the cash dividend 3 Credit Record the entry to close the dividend account to retained earnings. 4 Note: journal et

Explanation / Answer

Ans 1: May 20 Dividend                  Dr       256000

          To Dividend Payable                        256000

           June 14   No Entry

           July 14   Dividend Payable                       256000

                             To Cash                                         256000

           July 31   Retained Earnings                     256000

                           To Dividend                                       256000

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