accountign for cash dividends
Java company earned net income of $85,000 during the year ended Dec. 31, 2008. On Dec. 15, Java declared the annual cash dividend on its 4% preferred stock (par value, $100,000) and a $0.50 par share cash dividend on its common stock (50,000 shares). Java then paid the dividends on Jan 4, 2009.
Journalize for Java:
a. Declaring the cash dividends on Dec 15, 2008.
b. Paying the cash dividends on Jan 4, 2009.
this is what I've come up with but I don't feel very confident in it can someone help I'm not sur ewhich one is right!. my book isn't much of a help so if you also can recommend any sites that might help me learn accounting please do also. I didn't know how to do part B at all so I need help with it mostly. Thanks
Dec.15 Retained Earnings 25,000
Dividends Payable 25,000
Declared a cash dividend.
Dec. 15 Retained Earnings 4,000
Dividends Payable 4,000
Declared a cash Dividend
