Question

Divine Apparel has 4,000 shares of common stock outstanding. On October 1, the company declares a $0.75 per share dividend to stockholders of record on October 15. The dividend is paid on October 31. Record all transactions on the appropriate dates for cash dividends. (If no entry is required for a particular transaction/event, select "No Journ

Answer 1

The journal entries shown below:

Step-by-step explanation:

On October 1

Dividends A/c.................................Dr $3,000

Dividend Payable A/c...................Cr $3,000

Being company declared the dividend of 4,000 shares at the rate of $0.75 per share.

On October 15

No Journal Entry Required

On October 31

Dividends Payable A/c...................Dr $3,000

Cash A/c......................................Cr $3,000

Being Dividend is paid, so cash is decreasing and any decrease in asset is credited. Therefore, cash account is credited. And the account of dividend payable is debited.