Question

Question 5

On January 1 Weiss Corporation had 60,000 shares of no-par common stock issued and outstanding. The stock has a stated value of $5 per share. During the year, the following transactions occurred:

Apr. 1		Issued 10,000 additional shares of common stock for $10 per share.
June 15		Declared a cash dividend of $1.00 per share to stockholders of record on June 30.
July 10		Paid the $1.00 cash dividend.
Dec. 1		Issued 4,000 additional shares of common stock for $12 per share.
15		Declared a cash dividend on outstanding shares of $1.00 per share to stockholders of record on December 31.

Prepare the entries, if any, on each of the three dates that involved dividends. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
choose a transaction date June 15July 10Dec. 15	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date June 15July 10Dec. 15	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date June 15July 10Dec. 15	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount

How are dividends and dividends payable reported in the financial statements prepared at December 31?

In the retained earnings statement, select an option

DividendsDividends Payable

of $enter a dollar amount will be select an option

deductedadded

.

In the balance sheet, select an option

DividendsDividends Payable

of $enter a dollar amount will be reported as a select an option

current assetcurrent liability

.

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Answer 1

Date	Journal Entry	Dr. ($)	Cr. ($)
1st April	cash (10000*$10)	100000
	To common stock (10000*$5)		50000
	To additional paid-in capital		50000
15th June	cash dividend ((60000+10000)*$1)	70000
	To dividend payable		70000
10th July	dividend payable	70000
	To cash		70000
1st Dec	Cash (4000*$12)	48000
	To common stock (4000*$5)		20000
	To additional paid-in capital		28000
15th Dec	cash dividend (60000+10000+4000)*$1	74000
	To dividend payable		74000

cash dividend ($70000+74000) = $144000 will be reported on the statement of retained earnings and has a decreasing effect on retained earnings

dividend payable $74000 will be reported as current liabiliteis on the balance sheet