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Problem
On May 20, the board of directors for Auction.com declared a cash dividend of 50 cents per share payable to stockholders of record on June 14. The dividends are paid on July 14. The company has 507,000 shares of stock outstanding. Closing entries are recorded on July 31. Prepare any necessary journal entries for each date.
Journal Entries For:
1. May 20-Record the entry on the date of declaration for a cash dividend of 50 cents per share payable on the 507,000 shares of stock outstanding
2. June 14-Record the entry on the date of record for a cash dividend of 50 cents per share payable on the 507,000 shares of stock outstanding
3. July 14-Record the entry on the date of payment for the cash dividend.
4. July 31-Record the entry to close the dividend account to retained earnings.
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