Question

Weaver Corporation had the following stock issued and outstanding at January 1, Year 1:

Answer 1

Answer:

Preferred shareholder (7,500*$100)*7%   $52,500

Common shareholder (70,000×$2)          $140,000

Total dividend                                            $192,500

Date         General Journal                  Debit         Credit

10 June     Dividend                            $192,500

                        To dividend payable                      $192,500

                 (To record dividends payable)

20 June    No entry required

01 July       Dividend payable              $192,500

                         To cash                                           $192,500

                  (To record dividend payment)  

31 Dec      Retained earning               $192,500

                         To dividends                                   $192,500

                (To close dividend account)