Question

Common and Preferred Cash Dividends

Wang Company currently has 200,000 shares of $1 par common stock outstanding and 2,900 shares of $50 par preferred stock outstanding. On July 10, the board of directors declared a semiannual dividend of $0.33 per share on common stock to shareholders of record on August 1, payable on August 5.

On July 15, the board of directors declared a semiannual dividend of $4 per share on preferred stock to shareholders of record on August 5, payable on August 10.

Prepare journal entries for the declaration and payment of the common and preferred stock cash dividends. If an amount box does not require an entry, leave it blank.

Page: 1

	DATE	ACCOUNT TITLE	DOC. NO.	POST. REF.	DEBIT	CREDIT
1	20-- Jul. 10						1
2							2
3							3
4	Jul. 15						4
5							5
6							6
7	Aug. 5						7
8							8
9							9
10	Aug. 10						10
11							11
12							12

Answer 1

Date	ACCOUNT TITLE	DOC. NO.	POST. REF.	DEBIT	CREDIT
20-- Jul. 10	Cash Dividends			66000		=200000*0.33
	Common dividends payable				66000
Jul. 15	Cash Dividends			11600		=2900*4
	Preferred dividends payable				11600
Aug. 5	Common dividends payable			66000
	Cash				66000
Aug. 10	Preferred dividends payable			11600
	Cash				11600