### Understanding Cash Dividend Declarations and Internal Controls#### Cash Dividend Declaration**Scenario Overview:**On October 1, 2023, the board of directors of Marge Inc. declared a $1.50 per share cash dividend on 55,000 shares of $1 par value common stock. The dividend will be paid to stockholders who own shares on December 31, 2023, with the payment date set for February 1, 2024. The following outlines the necessary journal entries for each relevant date:- **a. October 1, 2023**: - **[Journal Entry Box]** - Explanation: Record the declaration of the dividend. Debit "Retained Earnings" and credit "Dividends Payable."- **b. December 31, 2023**: - **[Journal Entry Box]** - Explanation: No journal entry is typically required on this date as it is the record date, which determines eligible shareholders.- **c. February 1, 2024**: - **[Journal Entry Box]** - Explanation: Record the payment of the dividend. Debit "Dividends Payable" and credit "Cash."#### Internal Control Principles**Scenario 1: Cash Register Control at Kwik-E-Mart**Bart & Lisa use the same cash register drawer, which can lead to internal control issues.- **a. What principle of internal control is being violated?** - Lack of segregation of duties, as multiple individuals have access to the same cash drawer, making it difficult to track accountability.- **b. How could a new policy improve this internal control violation?** - Implement separate cash drawers for each person to ensure clear responsibility and accountability for any discrepancies.**Scenario 2: Check Control at The Leftorium**The employee responsible for checks keeps them in an unlocked desk.- **a. What principle of internal control is being violated?** - Lack of physical security and safeguarding of assets, as checks are not stored securely, increasing the risk of theft or misuse.- **b. How could a new policy improve this internal control violation?** - Require that checks are kept in a locked drawer or safe, with access limited to authorized personnel only, to enhance physical security.

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Answered: On Oct. 1, 2023, the board of directors…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Mustang Corporation had 100,000 shares of $2 par value common stock outstanding. On December 31, 2018, the company's board of directors declares a 50 percent stock dividend. This stock dividend will be distributed on January 20, 2019 to the stockholders of record on January 15, 2019. The market price of the company's stock is $10 per share on December 31, 2018. Prepare the journal entry.
Doug Graves Cemetery had 69,000 shares of common stock issued and outstanding at January 1, 2021. During 2021, Graves took the following actions: June 1 Declared a 2-for-1 stock split, when the fair value of the stock was $44 per share. October 15 Declared a $0.50 per share cash dividend. In Graves's statement of shareholders' equity for 2021, what amount should Graves report as dividends?
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Indicate the amount of annual dividend on each issue of the preferred shares by completing the last column of the above table Assume that there are one year of dividends in arrears at the beginning of 2020, and Essex declared total dividends of $40,000 in 2020. What is the amount of dividends that the common shareholders will receive in 2020?
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The articles of incorporation for Peahen Corp. authorize the company to issue 100,000 $6 preferred shares and 500,000 common shares. During first year of operations, Peahen Corp. completed the following selected transactions: (Click the icon to view the transactions.) Required 1. Record the transactions in the general journal. 2. Prepare the shareholders' equity section of the Peahen Corp. balance sheet at November 30, 2020. Requirement 1. Record the transactions in the journal. (Record debits first, then credits. Explanations are not required.) Dec. 4, 2019: Issued 6,000 common shares to the consultants who formed the corporation, receiving cash of $180,000. Date Dec. Journal Entry Accounts Debit Credit
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Mustang Corporation had 100,000 shares of $2 par value common stock outstanding. On December 31, 2018, the company's board of directors declares a 50 percent stock dividend. This stock dividend will be distributed on January 20, 2019 to the stockholders of record on January 15, 2019. The market price of the company's stock is $10 per share on December 31, 2018. Prepare the journal entry. Please dont provide soluton image based solutions thank you
SHOW THE JOURNAL ENTRY FOR EACH TRANSACTION!
4. ABC Co. issued a prospectus for the issue of 900,000shares at $6 per shares on 1 January 2019. The prospectus specified that $3.50 was payable on application, a further $1.25 was payable on allotment and the final $1.25 was payable at call. On 31 January 2019 ABC issued 300,000 shares. On 31 May 2019, the company made the call for the outstanding balance of $1.25 per share. The call was payable by 30 June 2019. At 30 June 2019, the call on 30,000 shares remained unpaid.Instructions:b) The Share Capital that would appear in the Balance Sheet of ABC Co. (2marks)

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