On February 16,a Company Declares a 68¢ Dividend to Be

question 92

Multiple Choice

On February 16,a company declares a 68¢ dividend to be paid on April 5.There are 950,000 shares of common stock issued and outstanding.The entry recorded by the company on April 5 includes a debit to:

• A) A debit to Dividends Payable and a credit to Cash for $680,000.
• B) A debit to Dividends and a credit to Dividends Payable for $646,000.
• C) A debit to Dividends Payable and a credit to Cash for $646,000.
• D) A debit to Dividends and a credit to Dividends Payable for $680,000.

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Definitions:

Minimum Floor Value

The least possible value guaranteed for a specific financial instrument or investment.

Convertible Bond

This bond variant grants the holder the option to exchange it for a fixed amount of the issuer's stock at specific intervals during the bond's duration, typically based on the bondholder's decision.

Straight Bond Value

Straight bond value is the value of a bond that pays fixed interest payments until maturity and repays the principal at maturity without any special features such as convertibility or callability.

Call Value

The price at which a bond or other debt security can be redeemed by the issuer before its maturity date.