Question

On December 31, as a short-term investment, Arlington and Fry purchased 500 shares for $50,000. The...

On December 31, as a short-term investment, Arlington and Fry purchased 500 shares for $50,000. The shares pay a $0.40 cash dividend on February 28. The entry to record the dividend would be:
Dividend Expense 200
Cash 200
Cash 50,000
Investment 50,000
No entry
Cash 200
Dividend Income 200
Cash 200
Investment 200

Homework Answers

Answer #1
Date Description Debit Credit
Feb-28 Cash A/c                                             Dr. $200
                      To Dividend Income A/c $200
(Being dividend received from short term investment)
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