Respuesta :
Answer:
On June 1
Dr Retained earnings $9,960,000.00
Cr Dividends payable $ 9,960,000.00
To record declaration of $0.83 dividend per share
On 30 June
Dr Dividends payable $ 9,960,000.00
Cr Cash $ 9,960,000.00
To record payment of dividends to shareholders
Explanation:
The cash dividends as voted by board of directors amount to $ 9,960,000.00 (12 million*$.083)
However, on June 1 the following entries are required to show an obligation towards the shareholders, in other words, the amount owed to shareholders payable out of retained earnings are reflected thus:
Dr Retained earnings $9,960,000.00
Cr Dividends payable $ 9,960,000.00
To record declaration of $0.83 dividend per share
On the 14th of June, no entries are required as recording the dividends does not impact books of accounts.
On 30th June , the following entries are required to payment of cash dividends.
Dr Dividends payable $ 9,960,000.00
Cr Cash $ 9,960,000.00
