Question

Divine Apparel has 3,000 shares of common stock outstanding. On October 1, the company declares a $0.50 per share dividend to stockholders of record on October 15. The dividend is paid on October 31.

a) Record the clarion of cash dividends.

b )Record the entry on date of record.

c) Record the payment of cash dividends.

Answer 1

	DATE	PARTICULARS	DEBIT	CREDIT
(a) Declaration of Dividend	1-Oct	Retained Earnings	$          1,500
		Dividend Payable		$    1,500
		(Dividend declared)
(b) Record Date	15-Oct	No Entry on this date
(c ) Payment of Cash dividend	31-Oct	Dividend Payable	$          1,500
		Cash		$    1,500
		(Dividend paid)