A company’s board of directors declares a cash dividend on May 21 of $1 for each of its 800,000 shares. The date of record is June 10, and payment date will be June 25. Which entry would the company make to record the declaration May 21?

• The company does not make an entry until the payment date.
• Debit Retained earnings $800,000; Credit Cash $800,000
• The company does not make an entry until the date of record.
• Debit Retained earnings $800,000; Credit Dividends payable $800,000

A company has a net income of $100,000; cash dividends to common stockholders of $80,000; Cash dividends to preferred shareholders of $20,000 average common stockholders’ equity of $400,000; and average total stockholders’ equity of $500,000. What is the company’s return on equity?

• 4%
• 5%
• 20%
• 80%

Answer rating: 100% (QA)

Answer Debit Retained earnings 800000 Credit Dividends payable 800000 Explanation ... View the full answer