Midas Company earned net income of $85,000 during the year ended December 31, 2014. On December 15, 2014, Midas Company declared the annual cash dividend on its 6% preferred shares ($100,000) and a $0.50 per share cash dividend on its common shares (50,000 shares outstanding). Midas Company then paid the dividends on January 4, 2015.
Journalize for Midas Company
a. Declaring the cash dividends on December 15, 2014.
b. Paying the cash dividends on January 4, 2015.