Question

Divine Apparel has 2,600 shares of common stock outstanding. On October 1, the company declares a $0.25 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.

Answer 1

Answer:

Explanation:

The journal entries are shown below:

On October 1

Dividend Declared A/c Dr $650        (2,600 shares × $0.25)

         To Dividend payable A/c $650

(Being dividend is declared)

On October 15

No entry is required

On October 31

Dividend payable A/c Dr  $650

        To Cash A/c  $650

(Being dividend is paid for cash)