tommi walker corp's board of directors declared a dividend for all its shareholders there are 8,000 of
Question:
tommi walker corp's board of directors declared a dividend for all its shareholders there are 8,000 of dividends in arrears for its cumulative preferred shares. there are 1,000 shares of cumulative preferred shares outstanding. dividends for them are 4.00 per share. furthermore there are 2,000 shares of non-cumulative preferred shares outstanding which pay 6.00 dividend per share. for common shareholders, 9/25 per share dividend has also been declared. there are 10,000 shares of common stock outstanding. to record the dividend declaration you would
A. debit retained earnings 112,500
credit cumulative preferred stock dividend payable 8,000
credit non-cumulative preferrred stock dividend payable 12,000
credit common stock dividend payable 92,500
B. debit retained earnings 8,000
credit cumulative preferred stock dividend payable 12000
credit non-cumulative preferrred stock dividend payable 92500
credit common stock dividend payable 112,500
Intermediate Accounting
ISBN: 978-1119048541
11th Canadian edition Volume 2
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Nicola M. Young, Irene M. Wiecek, Bruce J. McConomy