Cash dividend: The Cash dividend is the amount of dividend paid to shareholders in cash. The Cash dividend is declared first and paid later. There are two journal entries made, one at the time of declaration of dividend and another at the time of payment. Stock Dividend: The Stock dividend is the number of shares given as dividend to the shareholders. The Stock dividend is declared first and shares are issued later. There are two journal entries made, one at the time of declaration of stock dividend and another at the time of issuance of shares. To record the declaration of small stock dividends, the retained earnings is debited with the market value of shares issued as stock and common stock dividend distributable account is credited with the same amount. At the time of issuing shares, the common stock dividend distributable is debited with the market value of shares issued as stock and common stock is credited with the par value of shares issued as stock and Paid in excess of par value- common stock is credited with the excess amount. To identify: True or false statements regarding the dividends.

Question

Want to see the full answer?

Answer 1

Question

Chapter 13, Problem 8QS

To determine

Concept Introduction:

Cash dividend:

The Cash dividend is the amount of dividend paid to shareholders in cash. The Cash dividend is declared first and paid later. There are two journal entries made, one at the time of declaration of dividend and another at the time of payment.

Stock Dividend:

The Stock dividend is the number of shares given as dividend to the shareholders. The Stock dividend is declared first and shares are issued later. There are two journal entries made, one at the time of declaration of stock dividend and another at the time of issuance of shares.

To record the declaration of small stock dividends, the retained earnings is debited with the market value of shares issued as stock and common stock dividend distributable account is credited with the same amount. At the time of issuing shares, the common stock dividend distributable is debited with the market value of shares issued as stock and common stock is credited with the par value of shares issued as stock and Paid in excess of par value- common stock is credited with the excess amount.

To identify: True or false statements regarding the dividends.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Simba Pets uses the perpetual inventory system. At the beginning of the quarter, Simba Pets has $42,000 in inventory. During the quarter, the company purchased $9,200 of new inventory from a vendor, returned $1,500 of inventory to the vendor, and took advantage of discounts from the vendor of $300. At the end of the quarter, the balance in inventory is $34,500. What is the cost of goods sold? A. $15,500 B. $14,900 C. $13,500 D. $16,200

I need help solving this general accounting question with the proper methodology.

Can you solve this general accounting problem with appropriate steps and explanations?