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    pab143 Posts: 1, Reputation: 1
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    #1

    Apr 18, 2011, 12:49 PM
    How do you journalize this
    Declared a cash dividend on the %4 $102 par preferred stock (1,050 shares outstanding) Declared a $0.55 per share dividend on the 95,000 shares of common stock outstanding
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    pready Posts: 3,197, Reputation: 207
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    #2

    Apr 18, 2011, 01:18 PM

    Debit Retained Earnings for the total amount
    Credit Dividends Payable for the amount

    To calculate the amounts:
    Preferred Dividends = Dollar amount of Peferred stock par value * the percentage rate * number of preferred shares outstanding

    Common Dividends = Price of dividend per share * number of common shares outstanding

    To get the total amount of dividends payable just add your preferred dividends and your common dividends together.
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