Question

Whispering Winds Corp. has 8,700 shares of common stock outstanding. It declares a $4 per share cash dividend on November 1 to stockholders of record on December 1. The dividend is paid on December 31. Prepare a tabular summary to record the declaration and payment of the cash dividend. Include margin explanations for the changes in revenues and expenses.

Answer 1

Date Account Title Debit Credit

Nov 1 Cash dividends $34,800

Dividends payable $34,800

($8,700*4)

Dec 31 Dividends payable $34,800

Cash $34,800