Following is a recent Microsoft press release: REDMOND, Wash.%u2014March 15, 201
ID: 2375944 • Letter: F
Question
Following is a recent Microsoft press release:
REDMOND, Wash.%u2014March 15, 2011%u2014 Microsoft Corp. today announced that its board of directors declared a quarterly dividend of $0.16 per share. The dividend is payable June 9, 2011 to shareholders of record on May 19, 2011.
Prepare the journal entries Microsoft used to record the declaration and payment of the cash dividend for its 8,668 million shares.
REDMOND, Wash.%u2014March 15, 2011%u2014 Microsoft Corp. today announced that its board of directors declared a quarterly dividend of $0.16 per share. The dividend is payable June 9, 2011 to shareholders of record on May 19, 2011.
Explanation / Answer
Hi,
Please find the journal entries as follows:
On the Date of Declaration (15th March 2011)
Retained Earnings Dr. (8668*.16) 1386.88
Dividend Payable Cr. 1386.88
On the Date of Record (19 May 2011)
No Journal Entry is Needed
On the Date of Payment (9 June 2011)
Dividend Payable Dr.1386.88
Cash Cr. 1386.88
Thanks.