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b. Dividends payable 142,500
Cash 142,500
c. Dividends 142,500
Retained Earnings 142,500
d. Dividends payable 142,500
Dividends 142,500
ANS: A PTS: 1 OBJ: LO1
NAT: AACSB correlation: analytic LOC: Learning type: Application
KEY: dividends
19. The board of directors of Irondale Corporation declared a cash dividend of $2.50 per share on 57,000
shares of common stock on June 14, 2010. The dividend is to be paid on July 15, 2010, to shareholders
of record on July 1, 2010. The effects of the entry to record the declaration of the dividend on June 14,
2010, are to
a. decrease stockholders' equity and increase liabilities.
b. increase stockholders' equity and increase liabilities.
c. decrease stockholders' equity and decrease assets.
d. increase stockholders' equity and decrease assets.
ANS: A PTS: 1 OBJ: LO1
NAT: AACSB correlation: analytic LOC: Learning type: Application
KEY: dividends
20. The board of directors of Irondale Corporation declared a cash dividend of $2.50 per share on 57,000
shares of common stock on June 14, 2010. The dividend is to be paid on July 15, 2010, to shareholders
of record on July 1, 2010. The proper entry to be recorded on July 15, 2010, will be:
a. Cash 142,500
Dividends Payable 142,500
b. Dividends Payable 142,500
Cash 142,500
c. Cash 142,500
Dividends 142,500
d. Dividends 142,500
Cash 142,500
ANS: B PTS: 1 OBJ: LO1
NAT: AACSB correlation: analytic LOC: Learning type: Application
KEY: dividends
21. The board of directors of Irondale Corporation declared a cash dividend of $2.50 per share on 57,000
shares of common stock on June 14, 2010. The dividend is to be paid on July 15, 2010, to shareholders
of record on July 1, 2010. The effects of the entry to record the payment of the dividend on July 15,
2010, are to
a. increase assets and decrease stockholders' equity.
b. decrease stockholders' equity and decrease liabilities.
c. decrease liabilities and decrease assets.
d. increase stockholders' equity and decrease liabilities.