On 1 November 2016,Oster Ltd Declared a Dividend of $3

question 49

Multiple Choice

On 1 November 2016,Oster Ltd declared a dividend of $3.25 per share.Oster Ltd has 28,000 shares of ordinary shares outstanding and no preference shares.Which of the following is the journal entry needed to record the declaration of dividends?

• A)debit Retained earnings $91,000 and credit Cash $91,000
• B)debit Cash $91,000 and credit Dividends payable,ordinary $91,000
• C)debit Dividends payable,ordinary $91,000 and credit Retained earnings $91,000
• D)debit Retained earnings $91,000 and credit Dividends payable,ordinary $91,000

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Definitions:

Available-for-Sale Investments

Securities that are not classified as held-to-maturity or trading securities and can be sold in the short-term or kept for long-term holdings, with unrealized gains or losses reported in other comprehensive income.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities, representing ownership interest in the company.

Brokerage Fee

A brokerage fee is a charge that a broker charges for the facilitation of transactions or services such as buying or selling stocks, real estate deals, or other financial services.

Dividend Per Share

The amount of dividend that a company pays out to each shareholder per share.