Exercise 11-10A Effect of cash dividends on financial statements LO 11-4 On May

Question

Exercise 11-10A Effect of cash dividends on financial statements LO 11-4 On May 1, 2016, Love Corporation declared a $50,000 cash dividend to be paid on May 31 to shareholders of record on May 15 Required a. Record the events occurring on May 1, May 15, and May 31 in a horizontal statements model like the following one. In the Cash Flow column, indicate whether the item is an operating activity (OA), investing activity (IA), or financing activity (FA) Balance Sheet Income Statement Cash Flow Commorn AssetsLiabilities+Stock Retained Earnings Date May 01 May 15 May 31 Revenue - Expense Net ncome

Explanation / Answer

Record the events :

Balance sheet Income statement Cash flow Date assets = Liabilities + common stock Retained earnings Revenue - Expenses = Net income May 01 50000 (50000) May 15 May 31 (50000) (50000) (50000) FA

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