At December 31, the unadjusted trial balance of H&R Tacks reports Dividend Declared of $0 and Dividends Payable of $0. A $200 dividend was declared on December 27, with payment in cash to occur three weeks later. Prepare the required journal entry. In separate T-accounts for each account, enter the unadjusted balances, post the journal entry, and report the adjusted balance.
Journal Entries and T-Accounts:
Accounting transactions are first recorded in the general journal through journal entries and are then posted to the respective ledger accounts or T-accounts. The debit and credit in a journal entry should always match.
Answer and Explanation:
The journal entry to record dividend declaration is as follows:
|Dec 27, 20XX||Retained earnings||$200.00|
|(to record declaration of dividend)|
T-account for dividend declaration:
|Dec 31, 20XX (cl. Bal)||$200||$200||Dec 27|
|Dec 31||$200||$200||Dec 27|
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from Accounting 101: Financial AccountingChapter 3 / Lesson 6